The Distinction Between Monopoly and Monopolization in Antitrust Law

^Pr^ep^ar^{ed f}^o^r^M^e^m^b^ers^an^d^Com^mⁱ^t^t^ees^of^C^ong^r^e^ss

Antitrust law does not mandate either that markets be competitive, or that they contain some
predetermined number of participants/competitors; it is concerned, rather, with the operation of
markets, on the assumption that a properly functioning market (i.e., one in which there is an
opportunity for viable competition, and is not skewed by the predatory actions of participants),
will best protect consumers. “Monopoly” and “monopolist” are, therefore, merely descriptive
terms, used to illustrate situations in which a single entity (or group of entities) possesses
effective control of the market in which it operates; neither term implies anything about the
lawfulness of the monopoly possessed. “Monopolization,” on the other hand, is the term used in
antitrust law to characterize as unlawful a situation in which a monopolist—irrespective of
whether his monopoly has been lawfully achieved—couples his monopoly status with behavior
designed to unfairly exploit, maintain, or enhance his market position. Similarly, “attempted
monopolization”connotes a situation in which an entity unlawfully or unfairly attempts to secure
a market monopoly. The long-standing, judicially created Rule of Reason, which involves
balancing an anticompetitive action with any procompetitive results, underscores those facts.
Whether a market participant who is a monopolist must deal with anyone who desires to deal with
it continues to be largely governed by the so-called Colgate doctrine. In 1919, in United States v.
Colgate & Co. (250 U.S. 300), the Supreme Court recognized the unfettered “right” of a private
vendor “to exercise his own independent discretion as to parties with whom he will deal ....”
Colgate notwithstanding, the existence of an “essential facility” (i.e., a necessary component of a
potential competitor’s business and which is both unavailable from any source other than the
alleged monopolist and cannot be reasonably duplicated), once established, has generally been
thought to impose a duty to deal with the actual or potential competitors of even a lawful
monopolist. The continuing viability of the so-called “essential facilities” doctrine, however, was
called into question by the Supreme Court’s 2004 ruling in Verizon v. Trinko (540 U.S. 398).
The Antitrust Division of the Department of Justice (DoJ) and the Federal Trade Commission
(FTC) each operate on the assumption that the monopoly status of competitors is antitrust-
relevant only insofar as their actions may impact the operation or competitiveness of markets.
This report—which explores the difference between monopoly and monopolization as those
terms are used in antitrust law, and the differing enforcement consequences of each—will be
updated if case law or legislation alters the concepts it discusses. It is based on several existing
documents by the same author, including CRS Report RS20241, Monopoly and Monopolization -
Fundamental But Separate Concepts in U.S. Antitrust Law; CRS Report RS21723, Verizon
Communications, Inc. v. Trinko: Telecommunications Consumers Cannot Use Antitrust Laws to
Remedy Access Violations of Telecommunications Act; and Duty of a Monopolist to Deal, a
general distribution memorandum.

Introduc tion ..................................................................................................................................... 1
Monopoly and Monopolization.......................................................................................................2
What the Antitrust Laws Prohibit..............................................................................................3
The Concept and Importance of “Relevant Market”.................................................................4
Judicial and Administrative Definition/Treatment of Monopoly Status....................................5
Monopolization ......................................................................................................................... 5
Attempted Monopolization.......................................................................................................6
Duty of Monopolist to Deal......................................................................................................6
In general............................................................................................................................6
Vis-a-vis markets adjacent to the one in which the monopolist usually operates...............7
“Essential facilities” doctrine..............................................................................................9
Verizon v. Trinko.................................................................................................................9
Some Examples of Antitrust Enforcement Agency Posture.....................................................11
Conclusion ..................................................................................................................................... 12
Author Contact Information..........................................................................................................13

Antitrust doctrine holds that robust competition will best protect consumers; it is concerned with
the viability of individual competitors only insofar as their fates affect marketplace ¹
competitiveness. There is neither an arbitrary antitrust directive concerning the requisite amount
of competition deemed acceptable in any given market, nor any predetermination of the point
beyond which a market participant may grow; nor is there any absolute number of competitors a
market participant must face. Although there are general prohibitions against monopolization and ²³
attempted monopolization in the Sherman and Clayton Acts, and a prohibition against “unfair ⁴
acts” in commerce in section 5 of the Federal Trade Commission Act, “monopoly” and
“monopolist” are merely descriptive terms, used to illustrate a situation in which a single entity
possesses effective control of the market in which it operates. Neither term implies anything
about the lawfulness of the monopoly possessed: there is no concept of “no fault” monopolization ⁵⁶
in United States antitrust law. Absent a finding by a court of “guilty behavior” by a monopolist,
therefore, there can be no finding of “monopolization.” Further, the antitrust Rule of Reason has
modified the concept of competition by recognizing that in certain situations the
anticompetitiveness of some actions must be balanced against any procompetitive effects that ⁷
might be produced by those actions.
Accordingly, any assessment of whether any of the prohibitions against monopolization have
been violated requires two inquiries. First, it must be determined whether an entity is in fact a ⁸
monopolist; and second, whether that monopolist has unlawfully monopolized the market(s)
within which it operates (the applicable, “relevant market,” which may be either product- or
geographically based, or both).
Assuming that a market participant has been legally determined to be a monopolist (as opposed to
being so determined by reference to the popular definition—i.e., one who possesses at least a
51% market share), the question arises, “Does that monopoly entity have a legal obligation to

¹^“^T^he^pur^p^o^s^e^of^the^[^S^he^r^m^aⁿ^]^A^c^{t is}^{not to}^pr^o^t^e^c^t^busⁱⁿ^e^s^s^e^s^f^r^om^the^w^o^r^k^ing^of^the^m^a^r^k^e^{t; it i}^s^{to pr}^ote^c^t^t^h^e
^pub^lic^f^r^om^the^f^a^ilure^of^the^m^a^r^k^e^t^{. T}^h^e^la^w^dire^c^t^{s itse}^l^f^{not a}^g^aⁱ^{nst c}^oⁿ^duc^t^w^h^ic^{h is c}^o^m^p^e^titiv^e^,^e^v^eⁿ^se^v^e^r^e^l^y^so,
^{but a}^g^aⁱ^{nst c}^o^nd^uc^{t w}^h^ic^{h u}ⁿ^f^a^irly^te^{nds to de}^stroy^c^o^m^p^e^{tition its}^e^l^f^.^{It doe}^{s so}^not^o^u^{t of}^solic^it^ud^e^f^o^{r priv}^a^t^e
^c^onc^e^r^{ns b}^u^t^out^of^c^onc^e^r^{n f}^o^{r t}^h^e^pub^licⁱⁿ^te^re^st.”^Spe^c^t^rum^Sport^s^{, Inc}^.^v^.^Mc^Qu^illa^n,⁵^{06 U.}^S.⁴⁴^{7, 4}⁵⁸⁽¹⁹⁹^3).
²^{15 U}^.^S.C^.^§^§^1-^{7 (}^s^pe^cⁱ^fⁱ^c^a^l^l^y^{, 15 U}^.^S.C^.^§²⁾^.
³^{15 U}^.^S.C^.^§^§^12-^{27 (}^s^pe^cⁱ^fⁱ^c^a^l^l^y^{, §}¹⁸⁾^.
⁴^{15 U}^.^S.C^.^§⁴⁵^.
⁵^I^.^e^{., t}^h^e^r^e^isⁿ^o^“^b^rⁱ^g^h^t^line^”^f^o^r^t^h^e^sⁱ^z^e^be^y^{ond w}^h^ic^{h a}ⁿ^eⁿ^ti^ty^m^a^y^g^r^o^w^be^f^o^r^e^{it is}^de^e^m^e^d^a^“m^ono^po^ly^.”
^A^t^t^e^m^p^t^s^d^u^rⁱⁿ^{g t}^h^e¹⁹⁷⁰^s^t^o^creat^{e “n}^o^f^a^u^l^t^m^oⁿ^o^p^o^lⁱ^zatⁱ^oⁿ^”^w^e^{re n}^o^t^s^u^ccess^f^u^l⁽^see,^e.^g^.^,^S^.¹¹⁶⁷^,⁹³^d^C^oⁿ^g^r^e^ss,
^s^pons^or^e^d^by^Se^na^tor^P^hⁱ^{lip H}^a^r^t^,^intr^od^uc^e^d^Ma^r^c^h^12,¹⁹⁷³⁽¹¹⁹^C^ong^{. R}^e^c^.⁷³²⁰⁾^;^S.¹¹^{67 w}^oul^d^ha^v^e^m^a^de
^unla^w^f^u^{l the}^m^e^r^e^pos^s^e^s^sⁱ^{on of}^m^onopoly^pow^e^r^;^see^f^ootnote¹⁵^,^infr^a^{, f}^o^r^a^br^ie^f^de^s^c^rⁱ^ption^of^S^.¹¹⁶⁷⁾^.^Se^e^be^l^o^w
^f^o^{r a}^disc^ussion^of^som^e^{DoJ a}^{nd FT}^{C e}ⁿ^f^o^rc^e^m^eⁿ^{t a}^c^tiv^itie^s^tha^t^u^nde^rsc^o^re^the^“^m^ono^poly^-^by^-itse^l^f^-^is-not-unla^w^f^u^l”
^noti^oⁿ^.
⁶^Ex^am^ple^s^of^“^g^uilt^y^be^ha^vⁱ^or^”ⁱⁿ^c^l^ude^{, e}^.^g^.,^pr^e^d^a^t^or^y^pr^ic^ing^or^ty^ing^the^pur^c^h^a^s^e^of^aⁿ^uⁿ^w^a^nte^d^pr^o^duc^{t t}^o^t^h^e
^pur^c^h^a^s^e^of^one^ov^e^r^w^h^ic^{h the}^s^e^lle^r^ha^s^a^m^onop^oly^.
⁷^T^h^e^c^onc^e^p^{t of}^a^Rule^of^Re^a^s^{on w}^a^{s f}ⁱ^{rst utiliz}^e^dⁱⁿ^Sta^nda^r^d^Oil^{Co. of}^Ne^w^Je^rs^e^y^v^.^Unite^{d Sta}^t^e^s^{, 22}^{1 U.S}^.¹
⁽¹⁹¹¹⁾^,^a^lth^oug^{h i}^t^w^a^s^m^o^s^t^c^l^e^a^r^l^y^e^nunc^ia^te^{d in}¹⁹^18,ⁱⁿ^B^o^a^r^d^of^T^r^a^d^e^of^the^Cⁱ^t^y^of^C^h^ic^a^g^{o v}^.^Uⁿ^ite^d^Sta^t^e^s^{, 2}⁴⁶
^U.^S^.³²^1,²³^{8 (}¹⁹¹⁸⁾^.^Se^eⁿ^o^t^es²¹^an^{d 22}^,ⁱⁿ^f^r^a^,^and^asso^ci^at^ed^t^e^xt^.
⁸^“^M^on^op^oly^pow^e^r^”^ha^s^,^sⁱ^nc^e^a^t^le^a^s^{t 195}^6,^be^eⁿ^de^fⁱ^ne^{d a}^s^“^t^he^p^o^w^e^r^{to c}^ontr^o^{l m}^a^r^k^e^t^pr^ic^e^s^or^e^x^c^l^ude
^c^o^m^p^e^tition”^(Unite^{d Sta}^t^e^s^v^.^E.I^.^du^Po^nt^de^Ne^m^{ours &}^Co.,³⁵¹^{U.S. 3}⁷⁷^,³⁹¹⁽¹⁹⁵^6)).

deal with any or all of its actual or potential competitors?” The courts have generally answered, ⁹
“No,” but the situation long thought to create such an obligation—monopolist ownership or ¹⁰
control of an “essential facility”—is, currently, not as settled as was once thought. In 2004, the
Supreme Court opined that “We have never recognized such a doctrine ... and we find no need ¹¹
either to recognize it or to repudiate it here.”
The recent prosecutions by the Antitrust Division of the Department of Justice (Microsoft) and the
Federal Trade Commission (Intel) (both discussed below) are particularly illustrative of the
monopoly/monopolization dichotomy.

Although monopoly and monopolization are fundamental, and related, concepts in antitrust law,
they are not synonymous. A shorthand definition of “monopoly” is “the power to control prices or ¹²
exclude competition.” The significance of the ability to exclude competition or control prices,
however, lies in the supposed deleterious effect of the lack of competition on, consumers, who are
presumed to benefit from the existence of largely competitive markets. The impact on excluded
competitors is relevant only insofar as it affects the fate of competition:
^‘^[^t]^h^e^aⁿ^titr^u^s^{t i}ⁿ^j^u^r^y^r^e^q^uⁱ^r^e^m^eⁿ^t^o^b^lig^ate^s^[^c^o^m^p^l^ain^aⁿ^t^s]^to^d^e^m^oⁿ^s^tr^{ate, as a}^th^r^e^s^h^o^l^d
^m^a^tter^,^“^t^h^a^{t t}^h^{e ch}^al^len^g^ed^c^oⁿ^d^u^c^t^h^a^s^h^a^d^an^act^u^a^{l ad}^v^e^r^s^{e ef}^f^{ect o}ⁿ^co^m^p^etitioⁿ^{as a}
^w^{hole in}^t^h^{e relev}^aⁿ^t^m^a^r^k^{et; t}^o^prov^{e it h}^a^s^been^h^a^r^m^{ed as}^anⁱⁿ^di^vⁱ^du^{al co}^m^p^et^itor^wⁱ^l^l¹³
ⁿ^o^{t su}^f^f^ice.”^’
^“^{... it i}^s^axio^m^a^tic^th^at^th^{e a}ⁿ^ti^t^r^u^s^{t la}^w^s^w^e^{re pas}^s^{ed f}^o^{r ‘}^t^h^e^protection^of^co^m^p^{etition, not}¹⁴
^co^m^p^etitors^.’^”

⁹^“^D^e^s^pite^the^g^e^ne^ra^lly^rec^o^gⁿ^iz^{ed e}^v^ils^of^m^onopoly^pow^e^r^{, it is}^‘^w^e^{ll s}^e^ttle^d,’^Se^e^{J. v}^{on Ka}^lin^ow^sk^{i, A}ⁿ^{titrust L}^a^w^s
^&^T^r^a^d^e^R^e^g^u^la^{tion ¶}⁸⁰²⁽³⁾^{, a}^t⁸^-^{41 (}¹⁹⁷⁹⁾^{, tha}^t^§²^doe^sⁿ^o^t^pr^o^hⁱ^{bit m}^ono^po^ly^Simplic^ite^r^o^r^,^{as t}^h^{e S}^u^p^r^em^{e Co}^u^r^t
^phra^s^e^d^itⁱⁿ^the^e^a^r^ly^la^ndm^a^r^k^c^a^s^e^of^Sta^nda^{rd O}^{il C}^o^.^of^N^e^w^J^e^rs^e^y^{, ... 22}^{1 U}^.^S^.^a^t⁶²^,^{... ‘m}^on^o^poly^{in the}
^c^onc^r^e^te^.’^”⁽^B^e^r^k^e^y^P^hot^{o, I}ⁿ^c^.^v^.^Ea^s^t^m^a^{n K}^oda^k^C^o^.,⁶⁰³^F.2^d²⁶^{3, 2}⁷³⁽²^{d C}ⁱ^r^.¹⁹⁷⁹^,^cert^.^d^eⁿⁱ^ed^,⁴⁴^{4 U}^.^S^.¹⁰⁹³
⁽¹⁹⁸⁰⁾^{; e}^m^pha^sⁱ^s^a^dde^d)^.^S^ee,^a^l^s^o^,^Am^eri^can^T^o^b^acco^Co^.^v.^Unⁱ^t^ed^S^t^at^es,³²^{8 U.}^S^.⁷⁸¹^,⁸⁰⁹⁽¹⁹⁴⁶⁾^;^Unⁱ^t^e^d^S^t^at^{es v.}
^G^rⁱ^f^f^{ith, 33}^{4 U}^.^S^.¹⁰⁰^,¹^{07 (}¹⁹⁴⁸⁾^{; U}ⁿ^ite^d^Sta^t^e^s^v^.^C^o^l^u^m^b^ia^Ste^e^l^C^o^.,³³^{4 U}^.^S^.⁴⁹⁵^,⁵²⁵⁽¹⁹⁴⁸⁾^{; U}ⁿ^ite^d^Sta^t^e^s^v^.
^A^l^u^mⁱⁿ^u^m^Co^.^o^f^Ameri^{ca (h}^ereiⁿ^a^f^t^{er re}^f^e^rred^t^o^as^Alc^o^a⁾^,¹^{48 F}^.^{2d 41}^{6, 42}⁴⁽^2d^Cⁱ^r^.¹⁹⁴⁵⁾^.
¹⁰^Aⁿ^“^e^sse^ntia^{l fa}^c^ilit^y^”^{is sa}^{id to e}^x^{ist w}^h^eⁿ^aⁿ^ecessa^ry^{(not m}^e^re^l^y^de^sⁱ^ra^ble⁾^c^o^m^poneⁿ^t^of^a^po^te^nt^ia^{l c}^o^m^p^e^titor’s
^bus^ine^s^s^is^bot^h^una^v^a^ila^ble^f^r^om^aⁿ^y^s^our^c^e^othe^r^thaⁿ^the^m^ono^po^lis^t,^an^d^c^a^nno^{t be}^du^plic^a^t^e^d^by^a^poteⁿ^tⁱ^a^l
^c^o^m^p^e^titor—e^ithe^r^a^t^a^{ll or}^oⁿ^ly^a^t^g^r^e^a^t^e^x^pe^nse^a^{nd/or tim}^e^.
¹¹^V^e^riz^o^{n Com}^m^unic^a^{tions, Inc}^.^v^.^L^a^w^O^f^fⁱ^c^e^{s of}^Curtis^V^.^T^r^ink^o^,⁵⁴^{0 U.S}^.³⁹⁸^,⁴¹¹⁽²⁰⁰^{4) (Cita}^ti^ons^om^itte^d).
^T^h^e^f^a^c^t^tha^t^tha^t^la^ng^ua^g^e^w^a^s^dic^t^a^ha^s^{not c}^u^r^t^a^ile^d^dis^c^us^sⁱ^oⁿ^of^its^im^plic^a^tions^.^S^ee,^e.^g^.^,^“Co^m^p^l^aiⁿ^t^f^o^{r Breach}^o^f
^D^u^ty^b^y^Inc^u^m^b^eⁿ^{t Pho}ⁿ^e^Com^p^aⁿ^y^unde^{r T}^e^le^c^o^m^m^unic^a^tions^A^c^{t D}ⁱ^{d N}^o^t^Sta^t^e^Aⁿ^titrus^{t C}^l^aⁱ^m^,^”^{21 C}^o^m^pute^r^a^nd
^In^tern^{et L}^a^w^.³⁴^,^(A^p^r^{il 2}⁰⁰⁴⁾^;^Nⁱ^ch^o^l^{as E}^c^on^o^mⁱ^d^es,^“V^ertⁱ^cal^L^e^vera^{ge an}^d^t^h^{e S}^acri^fⁱ^{ce P}^rⁱⁿ^ci^p^l^e^:^W^h^y^t^h^e
^Supr^e^m^e^C^our^{t G}^o^{t T}^r^ink^o^W^r^on^g^,^”^{61 N}^.^Y^.^U^.^Aⁿⁿ^.^S^u^r^v^{. A}^m^{. Law}^{379 (}²⁰⁰⁵⁾^;^J^o^hn^T^hor^ne^,^“^A^C^a^te^g^o^rⁱ^c^a^l^R^u^le
^Lⁱ^m^iting^Se^c^{tion 2}^of^the^S^h^e^r^m^a^{n A}^c^{t: V}^e^riz^oⁿ^v^T^r^ink^o^,”⁷²^U.^{Chi. L}^.^Re^v^.²⁸^{9 (W}^inte^r²⁰^05);^Jona^thaⁿ^L^.^Rubⁱ^n,
^“^T^he^T^r^{uth A}^{bout T}^r^ink^o^,”⁵⁰^Aⁿ^titrus^{t B}^u^lle^ti^{n 7}²⁵^(W^inte^{r 2}⁰⁰⁵⁾^.
¹²^Uⁿ^ite^d^Sta^t^e^s^v^.^E.I^.^du^Po^nt^de^N^e^m^our^s^&^C^o^.,³^{51 U}^.^S.³⁷^7,³⁹¹^-^{92 (}¹⁹⁵⁶⁾^.
¹³^A^nhe^us^e^r-Bus^c^h^{, Inc}^.^v^.^G^.^T^.^Bri^tts^Dⁱ^s^t^rib^u^ting^,^Iⁿ^c^.,⁴⁴^F.S^u^p^p^.^2d¹⁷^2,1⁷⁴^(N^.D^.N^.Y^.¹⁹⁹⁹⁾^,^qu^otⁱⁿ^g^{, G}^e^org^e
^H^a^ug^C^o^{. v}^.^R^o^l^l^s^R^o^y^c^e^Motor^C^a^r^s^{, I}ⁿ^c^{., 1}⁴⁸^F.^3d¹³^6,¹³^{9 (}^2d^Cⁱ^r^.¹⁹⁹⁸⁾^,^w^h^ic^h^qu^ote^d^{, Ca}^pito^l^Im^a^g^ing^v^.
^Moha^w^k^Va^lle^y^Me^{d. A}^s^s^o^c^s^{., 99}^{6 F.}^2d⁵^37,⁵^{43 (}²^d^Cⁱ^r^.¹⁹⁹³⁾^,^c^e^r^{t. de}^nie^d^,⁵¹^{0 U}^.^S.⁹⁴⁷⁽¹⁹⁹³⁾^.
¹⁴^Wⁱ^c^h^ita^Clinic^,^P.A^.^v^.^Colum^b^ia^/HCA^He^a^lthc^a^r^e^C^o^r^p^.^,⁴⁵^F^.^Su^pp^.^2d¹¹⁶⁴^,¹¹⁹³⁽^D^.^Kan^s^{as 19}⁹⁹⁾^,^qu^otin^g
^Brook^e^G^r^{oup v}^.^Br^ow^{n &}^W^illia^m^s^{on T}^ob^acco^,⁵⁰⁹^U.^S^.²⁰⁹^,²²^{4 (1}⁹⁹³⁾^,^q^uotⁱⁿ^g^B^r^ow^{n S}^hoe^C^o^.^v^.^Uⁿ^ite^{d S}^t^a^t^e^s^,
³⁷⁰^U^.^S.²^94,³^{20 (}¹⁹⁶²⁾⁽^e^m^pha^sⁱ^s^{in B}^r^ow^{n S}^hoe⁾^.

There is no concept of “no fault” monopolization in United States antitrust law,¹⁵ and courts have
differed over the years since the passage of the Sherman Act in 1890, as to the size of the market
share that must be attributable to a given market participant in order to accurately label the ¹⁶
participant a “monopolist.” Absent a finding by a court of “guilty behavior,”therefore, there can
be no automatic finding of “monopolization” based merely on a finding of monopoly power: a
finding of “monopoly power” does not, by itself, necessarily equate to a finding of the
monopolization prohibited by either section 7 of the Clayton Act or section 2 of the Sherman Act, ¹⁷
or the “unfair practices” prohibited by section 5 of the FTC Act.
The point that “monopoly” (or size) does not equate to unlawful “monopolization” was made in

1998 by the Assistant Attorney General, Antitrust Division:

^So^m^e^ti^m^e^s^{people com}^p^laiⁿ^a^bou^{t a m}^e^r^g^{er s}^o^lel^y^bas^e^{d on}^its^sⁱ^{ze. ... I w}^aⁿ^t^t^o^m^a^k^e^c^l^e^a^r^[^,
^h^o^w^e^v^e^r^,^]^th^{at a}ⁿ^titr^u^s^{t a}ⁿ^al^y^s^is^f^o^cu^se^{s o}ⁿ^th^e^sp^{ecific co}^mp^{etitive h}^a^r^ms^th^at^m^a^y^b^e
^as^s^o^ciated^wⁱ^t^h^{a particu}^l^ar^m^e^rg^er,^not^onⁱ^t^s^sizeⁱⁿ^th^{e a}^b^s^tra^c^t.^Th^u^s^{, f}^o^r^ex^am^pl^e^,^a^bⁱ^g
^m^e^rg^er^m^a^yⁿ^o^{t b}^e^ch^alleⁿ^g^ed^b^ecau^{se t}^h^e^m^e^r^gⁱⁿ^g^p^a^{rties ar}^{e n}^o^{t co}^m^p^etito^{rs o}^r^p^o^t^en^tial
^co^m^p^eti^t^o^r^{s o}^f^oⁿ^{e a}ⁿ^o^t^h^e^r^aⁿ^d^th^e^m^e^r^g^er^d^o^e^{s n}^o^{t r}^aⁱ^s^{e a}ⁿ^y^v^e^r^{tical a}ⁿ^titr^u^s^t^is^su^e^s^.^A^t^t^h^e
^sa^m^e^ti^m^e^,^w^e^m^a^y^c^h^alleⁿ^g^e^{a s}^m^aller^m^e^r^g^er^th^{at in}^v^o^l^v^{es th}^{e o}ⁿ^l^y^t^w^o^fⁱ^r^m^{s th}^at^m^a^k^e^a
^partⁱ^c^u^l^{ar produ}^ct^.^{The key for}^our^r^eview^is^w^h^ether^{the me}^r^g^er^w^ill^har^{m cons}^umer^s^,^not¹⁸
^th^{e sh}^{eer size o}^f^th^{e co}^rp^o^r^a^t^{e en}^{tities in}^vo^lved^.
As noted above, both the Sherman and Clayton Acts contain absolute prohibitions only against
monopolization and attempted monopolization: Section 2 of the Sherman Act makes it a felony
for any person to “monopolize, or attempt to monopolize, or combine or conspire with any other
person to monopolize [interstate] ... commerce”; section 7 of the Clayton Act, the so-called
antimerger provision, prohibits mergers or acquisitions by persons engaged in interstate
commerce “the effect ... may be substantially to lessen competition, or to tend to create a ¹⁹
monopoly.”

¹⁵^T^h^e^“^I^ndus^tr^ia^{l R}^e^or^g^a^niz^a^tion^A^c^t^”⁽^S^{. 11}⁶⁷^{, 9}³^d^C^o^ng^{., i}ⁿ^tr^o^d^u^c^e^d^by^Se^na^tor^P^hⁱ^lip^H^a^r^t⁾^w^oul^{d ha}^v^e^c^r^e^a^t^e^d^a
^reb^u^t^t^a^b^l^e^p^r^esu^m^p^tⁱ^o^{n t}^h^at^m^o^nop^o^l^y^p^o^w^{er exi}^s^t^e^d^w^h^en^ever,^e.^g^.^,^t^h^{ere w}^a^{s ei}^t^h^{er (1}^{) a l}^{ack o}^f^“su^b^s^t^aⁿ^tⁱ^a^l^p^rⁱ^ce
^c^o^m^p^e^{tition a}^m^ong^tw^{o or m}^o^re^c^o^rp^ora^tio^ns”^f^o^{r a}^spe^cⁱ^fⁱ^e^d^3-y^e^a^r^pe^rio^d^,^{or (2)}^“^f^{our or f}^e^w^e^{r c}^o^r^pora^tⁱ^ons
^a^c^c^ount^[ⁱ^ng^]^f^o^r^50%⁽^o^r^m^o^r^e⁾^of^s^a^les^”^“ⁱ^{n a}ⁿ^y^line^of^c^o^m^m^e^r^ce^{in a}ⁿ^y^s^e^c^{tion of}^the^c^o^untr^y^.”⁽^S^e^c^s^{. 101(}^b)⁽²⁾⁽³⁾⁾^.
^T^h^{e b}^{ill w}^o^u^l^d^also^h^a^v^e^p^l^aced^oⁿ^th^{e c}^o^rp^o^r^atioⁿ⁽^{s) f}^o^uⁿ^d^t^o^p^o^ss^ess^m^onop^oly^pow^e^r^{, e}^x^ce^{pt in c}^a^s^e^s^{in w}^h^ic^{h s}^u^c^h
^pow^e^r^w^a^s^the^r^e^s^u^{lt of}^la^w^f^ull^y^obtaⁱ^ne^{d pa}^te^nts^,^t^h^e^b^u^r^d^eⁿ^of^pr^ov^ing^{to a}ⁿ^Iⁿ^dus^tr^ia^l^R^e^or^g^a^niz^a^tion^C^o^ur^{t t}^h^a^t^s^u^c^h
^pow^e^r^s^houl^d^not^be^dⁱ^v^e^s^t^e^d⁽^S^e^c^.¹⁰¹⁽^c⁾⁾^.
¹⁶^“^[^90%^of^m^a^r^k^e^t^s^upply^]^is^eⁿ^ou^g^h^{to c}^o^ns^tit^ute^a^m^onop^oly^;^{it is}^dou^btf^u^{l w}^h^e^t^he^r^sⁱ^x^t^y^or^sⁱ^x^t^y^-^f^our^pe^r^c^eⁿ^{t w}^oul^d
^be^eⁿ^o^u^g^h^{; a}ⁿ^{d c}^e^r^ta^inly^thirty^-thre^e^pe^rc^eⁿ^{t is no}^t”⁽^Alc^o^a^,¹⁴^{8 F.}^2d⁴¹^6,⁴²^{4 (}²^{d C}ⁱ^r^.¹⁹⁴⁵⁾^;^t^h^e^c^o^ur^{t w}^a^s
^co^mmen^tⁱⁿ^{g o}ⁿ^t^h^{e vari}^ou^{s w}^a^{ys i}ⁿ^w^hⁱ^c^h^t^h^{e m}^a^r^k^et^coⁿ^t^ro^l^exerci^sed^b^y^A^l^co^{a co}^u^l^d^b^e^,^and^h^a^d^been^,^cal^cu^l^a^t^e^d^b^y
^t^h^{e d}ⁱ^st^ri^ct^co^u^r^t^.^T^h^{e case was ce}^rtⁱ^fⁱ^e^d^f^o^{r d}^eci^si^oⁿ^t^o^t^h^{e S}^eco^nd^Ci^rcuⁱ^t^b^y^t^h^{e S}^u^p^r^em^{e Co}^u^r^t^,^w^hⁱ^c^h^l^acked^t^h^e
^r^e^quis^ite^sⁱ^x^-^J^u^s^tic^e^q^uor^um^{to he}^a^r^it)^.^S^ee,^a^l^so^,^Unite^{d Sta}^t^e^s^v^.^Colum^b^ia^Ste^e^l^Co.^,^sup^r^a^{, f}^o^otn^o^te^9,^a^t⁵^27-^28:
^“W^{e d}^oⁿ^o^t^un^d^e^rt^{ake t}^o^p^r^escri^b^{e an}^y^s^e^t^o^f^p^e^rcen^t^a^ge^fⁱ^gu^{res b}^y^w^hⁱ^c^h^t^o^m^easu^r^{e t}^h^{e reaso}ⁿ^a^b^l^en^{ess o}^f^a
^c^o^rpora^tⁱ^{on’s e}ⁿ^la^rg^e^m^eⁿ^{t of}^{its a}^c^tiv^itie^{s .... T}^h^e^re^la^tiv^e^e^ffe^c^t^of^pe^rc^eⁿ^ta^g^e^c^o^m^m^a^{nd of}^a^m^a^rke^t^v^a^rie^s^w^{ith the}
^se^tting^{in w}^h^ic^{h t}^h^a^t^f^a^c^t^{or is pla}^c^e^d^.”
¹⁷^Se^e^no^te^s^{8 a}ⁿ^d^9,^sup^r^a^.
¹⁸^Joe^l^{I. Kle}ⁱ^{n, A}^ssistaⁿ^{t A}^ttorne^y^G^e^ne^r^a^{l, A}ⁿ^{titrust Div}ⁱ^sion^{, te}^sti^m^on^y^be^f^o^re^the^Se^na^te^Judicⁱ^a^r^y^Com^m^itte^e^,^June
^16,¹⁹⁹⁸⁽^e^m^pha^sⁱ^s^a^dde^d)^.
¹⁹^{15 U}^.^S.C^.^§^2;^{15 U}^.^S.C^.^§¹⁸^.

On the other hand, the judicially created Rule of Reason doctrine, first used in 1911 by the ²⁰
Supreme Court in Standard Oil Co. of New Jersey v. United States modifies the apparent
inflexibility of the prohibitions in those provisions. The doctrine recognizes that in certain
circumstances, adhering to the letter of the law concerning monopolization would be ²¹
unreasonable; and that the anticompetitiveness of some actions must be balanced against any ²²
procompetitive effects that might be produced by those actions.
Whether a market entity is considered a monopolist, or whether it can be successfully charged
with either having attempted to monopolize a market or actively monopolizing a market depends
on the definition of the market in which it operates. A defendant facing a charge of (attempted)
monopolization would prefer to have the relevant product market and/or the relevant geographic
market defined broadly. If he can include several interchangeable substitutes for his product, its
(and therefore, his) proportion of that product market will be calculated differently than if the
product market is confined to only his product, or his product and merely a few alternatives.
Similarly, the more expansive the definition of the geographic market within which the alleged
monopolist is operating, the less likely it is that he will be seen to control a sufficiently large
portion of it to justify a determination of “monopolist” or a finding of “(attempted)
monopolization.” And, as was noted earlier, “there can be no automatic finding of
‘monopolization’ based merely on a finding of monopoly power.” Moreover, the fact that a
trademarked or patented product gives the owner a lawful monopoly over that product may not ²³
suffice to justify a determination that he is a monopolist in a given market.

²⁰²²^{1 U}^.^S^.¹⁽¹⁹¹¹⁾^.
²¹^“^{... t}^h^e^le^g^a^lity^of^aⁿ^a^g^r^e^e^m^eⁿ^{t or re}^g^u^la^tio^{n c}^aⁿⁿ^o^t^be^de^te^rm^ine^d^by^{so sim}^p^le^a^te^{st, a}^s^w^h^e^t^he^{r it re}^stra^ins
^c^o^m^p^e^{tition. Ev}^e^r^y^a^g^r^e^e^m^eⁿ^{t c}^onc^e^r^ning^tra^d^e^,^e^v^e^r^y^re^g^u^la^tion^o^f^tra^d^e^,^re^stra^{ins. T}^o^bin^d^,^{to re}^str^a^{in, is}^of^theⁱ^{r v}^e^r^y
^e^sse^nc^e^.^T^h^e^true^te^{st of}^le^g^a^lit^yⁱ^s^w^h^e^t^he^{r the}^re^straⁱⁿ^tⁱ^m^p^o^s^edⁱ^s^su^ch^{as m}^e^rel^y^re^gu^l^a^t^e^{s an}^d^p^e^rh^ap^{s t}^h^ereb^y
^prom^ote^s^c^o^m^p^e^tition^{or w}^h^e^t^he^r^{it is}^s^u^c^h^a^s^m^a^y^s^uppre^s^s^{or e}^v^eⁿ^de^s^t^roy^c^o^m^p^e^{tition. T}^o^de^te^rm^ine^tha^t^q^u^e^s^tioⁿ
^the^c^our^{t m}^u^{st ordi}^na^rily^c^onside^r^the^f^a^c^t^{s pe}^c^u^lia^{r to t}^h^e^b^u^sine^ss^{to w}^h^ic^{h t}^h^e^re^stra^{int is a}^p^plie^d^;ⁱ^t^{s c}^ond^itioⁿ^be^f^o^re
^a^{nd a}^f^te^r^the^r^e^s^t^r^a^{int w}^a^sⁱ^m^pos^e^d^{; t}^h^e^na^tur^e^of^the^r^e^s^t^r^a^{int a}ⁿ^{d i}^t^s^e^f^f^e^c^t^{, a}^c^t^ua^{l or}^pr^oba^ble^.^T^h^e^hⁱ^s^t^or^y^of^the
^re^stra^{int, the}^e^v^il^be^lie^v^e^{d to e}^x^ist^,^the^re^a^s^on^f^o^{r a}^d^o^p^tin^g^t^h^e^pa^r^tⁱ^c^ula^r^r^e^m^e^d^y^{, the}^p^u^r^p^os^e^or^eⁿ^d^s^oug^{ht t}^o^be
^at^t^aⁱⁿ^ed^,^{are al}^l^rel^e^van^t^f^act^s.^{” B}^o^ard^o^f^T^r^ad^{e v.}^Unⁱ^t^e^d^S^t^at^es,²⁴⁶^U.^S^.³²¹^,²³⁸⁽¹⁹¹⁸⁾^.
²²^T^h^e^doc^trine^,^w^h^ic^{h is use}^d^a^s^aⁿ^a^lte^rna^tiv^e^m^e^aⁿ^{s of}^e^v^a^l^ua^ting^the^aⁿ^titr^{ust la}^w^f^ulne^{ss of}^c^h^a^lle^ng^e^d^a^c^tiv^itie^{s, is}
^em^ploy^e^d^only^w^h^{ere t}^h^{e act}ⁱ^oⁿⁱⁿ^qu^estⁱ^oⁿⁱ^sⁿ^o^t^a^u^t^o^m^a^tⁱ^cal^l^y^p^r^o^hⁱ^bⁱ^t^e^d^{as a}^p^e^{r se}^vⁱ^ola^tio^{n of}^th^e^aⁿ^titrust^la^w^s^.
^(P^ri^{ce f}ⁱ^xiⁿ^g^,^e.^g.^,ⁱ^s^a^p^e^{r se}^vⁱ^ol^a^{tion t}^h^a^t^c^aⁿ^ne^v^e^{r be}^sa^v^e^{d f}^r^o^m^ille^ga^lit^y^by^aⁿ^y^a^tte^m^p^{t to de}^s^c^ribe^the^pr^ic^e
^fⁱ^xiⁿ^g^{as “r}^easoⁿ^a^b^l^e.^”^S^ee,^e.^g^.^,^Uⁿ^ite^{d S}^t^a^t^e^s^v^.^T^r^eⁿ^ton^Potte^rⁱ^e^s^{, 27}^{3 U}^.^S.³⁹^2,³⁹^{7 (}¹⁹²⁷⁾^{: “}^T^he^pow^e^r^{to f}ⁱ^x^pr^ic^e^s^,
^w^h^e^t^he^r^r^e^a^s^ona^bly^ex^e^r^cⁱ^se^{d or}^not,^inv^o^lv^e^s^p^o^w^e^r^{to c}^ontr^o^{l t}^h^e^m^a^r^k^e^t^a^{nd to f}ⁱ^x^a^r^bitr^a^r^y^a^{nd u}ⁿ^r^e^a^s^ona^ble^pr^ic^e^.^”^;
^Uⁿ^ite^{d S}^t^a^t^e^s^v^.^Soc^o^ny^-^V^a^c^uum^O^{il C}^o^.,³^{10 U}^.^S.¹⁵^0,²¹^{7 (}¹⁹⁴⁰⁾^{: “}^f^or^ov^e^r^f^o^r^t^y^y^e^a^r^s^this^C^our^t^ha^s^c^ons^is^te^ntly
^a^{nd w}^itho^u^t^de^vⁱ^a^{tion a}^d^he^r^e^{d t}^o^the^prⁱⁿ^cⁱ^ple^t^h^a^t^pr^ic^e^-^fⁱ^xⁱ^ng^ag^r^e^em^eⁿ^ts^a^r^e^unla^w^f^u^{l pe}^r^s^e^un^de^r^the^S^h^e^r^m^aⁿ^A^c^t
^a^{nd t}^h^a^tⁿ^o^sh^ow^ing^of^so-c^a^lle^{d c}^o^m^p^e^titiv^e^a^buse^s^{or e}^v^ils^w^h^ic^{h those}^a^g^re^e^m^eⁿ^{ts we}^re^de^sigⁿ^e^d^{to e}^lim^ina^t^e^or
^a^lle^vⁱ^a^t^e^m^a^y^be^inte^r^pos^e^d^a^s^a^d^e^f^e^ns^e^”^;^A^r^iz^ona^v^.^Ma^rⁱ^c^opa^Me^dic^a^l^Socⁱ^e^t^y^,⁵⁵⁷^U^.^S.³^32,³^48-^{55 (}¹⁹⁸²⁾⁽^a^tte^m^p^t
^b^y^m^e^dⁱ^cal^so^ci^et^y^t^o^keep^{a “}^f^l^o^o^r^”u^nd^{er m}^e^dⁱ^cal^ch^{arges i}ⁿ^o^r^d^e^{r t}^o^keep^t^h^em^at^so^m^e^rea^s^oⁿ^a^b^l^{e rat}^e^d^eemed^p^rⁱ^ce
^fⁱ^xⁱ^ng^de^spite^f^a^c^t^tha^t^{it w}^a^s^ma^ximu^m^pr^ic^e^fⁱ^xⁱ^ng⁾^.
²³^S^ee,^e.^g^.^{, U.}^S^.^v.^duP^on^t^,^s^upr^a,^f^oot^note^8,³⁵^{1 U}^.^S^.^a^t³⁹³^:^“^...^[^t^h^e^]^p^o^w^e^r^tha^t^,^[^f^or^e^x^am^ple^]^{, a}^u^t^o^m^obile^or^s^o^f^t^-
^drink^m^a^nuf^a^c^t^ure^r^s^[^w^{ho, a}^d^m^itte^dly^,^produc^e^no^n-s^t^a^nda^rdⁱ^z^e^d^,^dⁱ^ff^e^r^eⁿ^tia^te^{d prod}^uc^ts^tha^t^m^a^y^or^m^a^y^{not ha}^v^e
^accep^tab^l^{e su}^b^s^titu^tes]^h^a^v^e^o^v^{er th}^{eir trad}^em^ark^e^d^p^r^o^d^u^c^{ts is}ⁿ^o^t^th^{e p}^o^w^e^{r th}^{at m}^a^k^e^{s an}^illeg^a^l^moⁿ^o^p^o^ly^{.” In}^earl^y
²⁰⁰^6,^the^C^ourt^re^v^e^rse^d^a^pre^s^um^{ption c}^onc^e^rⁿⁱ^ng^m^a^rke^t^pow^e^r^tha^t^it^ha^d^utiliz^e^d^f^o^{r ne}^a^r^ly^{40 y}^e^a^r^{s. In 2}⁰⁰⁶^{, t}^h^e
^C^our^{t w}^a^s^a^s^k^e^{d, in a}ⁿ^a^c^tioⁿ^un^d^e^r^{§ 1}^of^the^S^h^e^r^m^aⁿ^A^c^{t a}^lle^gⁱⁿ^g^a^de^f^e^nda^nt’^s^unla^w^f^u^{l t}^y^ing⁽^“^if^y^{ou w}^a^nt^m^y
^pa^te^nte^d^pro^duc^t,^y^{ou a}^l^{so ha}^v^e^t^o^ta^k^e^aⁿ^u^npa^te^nte^d^pr^od^uc^{t tha}^t^m^a^y^be^a^v^a^ila^ble^f^r^o^m^one^of^m^y^c^o^m^p^e^titors”⁾^{, to}
^a^pply^the^pr^e^s^um^ption^tha^t^a^de^f^e^nda^nt’^s^pos^s^e^s^sⁱ^oⁿ^of^m^onop^oly^pow^e^r^{in a}^r^e^le^v^a^{nt m}^a^r^k^e^t^tha^t^inc^l^ude^s^t^h^e^pa^te^nte^d^,
^ty^ing^pr^oduc^{t m}^a^y^be^pr^e^s^um^e^d^sole^ly^f^r^o^m^the^e^x^is^te^nc^e^of^his^pa^te^{nt. T}^h^e^C^our^{t s}^a^{id t}^h^a^t^itⁿ^o^l^ong^e^r^m^a^de^e^c^onom^ic
⁽^c^onti^nue^d.^..)

The courts have generally used a subjective “test” rather than an inflexible number for the amount
of market share that would be a prerequisite to a determination that a market participant has a
monopoly. The Supreme Court noted in 1956, for example, that “ [t]he relative effect of ²⁴
percentage command of a market varies with the setting in which that factor is placed.”
Eleven years earlier, the United States Court of Appeals for the Second Circuit, in a case decided ²⁵
upon transfer from a Supreme Court, on the way to noting that the way in which a market share
was calculated mattered, observed that although a 90 per cent share of a relevant market would be
“enough to constitute a monopoly[,] it is doubtful whether sixty or sixty-four per cent would be ²⁶
enough; and certainly thirty-three percent is not.”
In order to be found guilty of either “monopolization” or “attempted monopolization” one has
first to be determined to be a “monopolist.” As was observed earlier at footnote 8, the existence of
“monopoly power” is generally conceded if a market participant possesses the power “to control
prices or exclude competition.” A finding of monopoly power, by itself, however, will not support
a “monopolization” charge. In addition, a monopolist must generally also be guilty of “the willful
acquisition or maintenance of [monopoly] power as distinguished from growth or development as ²⁷
a consequence of a superior product, business acumen, or historic accident.” That having been
said, however, courts have had to evaluate actual business conduct in order to distinguish between
lawful (e.g., that having a “legitimate business purpose,” or that which is merely indicative of
aggressive competition) and unlawful (that which is predatory—i.e., seemingly economically
irrational except for its adverse effect on competition, or exclusionary) conduct by a monopolist.
Throughout its analysis a court must be mindful of the consumer protection purpose of the
antitrust laws, which protect competition, not competitors; as we noted at the beginning of this
report, the viability of individual competitors is relevant only to the extent their fates affect ²⁸
marketplace competitiveness.

^(...c^on^tin^ue^d)
^sen^s^{e t}^o^do^so^,^an^{d sen}^t^t^h^{e case b}^{ack t}^o^t^h^{e U.}^S^.^Cou^r^t^o^f^A^p^p^eal^{s fo}^{r t}^h^e^F^e^d^e^ral^Ci^rcuⁱ^t^(Il^lⁱⁿ^oⁱ^{s T}^o^o^l^W^o^{rks In}^c.^v.
^I^nde^peⁿ^d^eⁿ^t^Iⁿ^k^,^Iⁿ^c^{., (}⁵⁴⁷^U^.^S.⁽²⁰⁰⁶⁾^,^v^a^c^a^ti^{ng an}^d^r^e^m^a^ndi^ng³⁹⁶^F.3^d¹³^{42 (}^F^e^d^{. C}ⁱ^r^.²⁰⁰⁵⁾⁾^.^T^h^e^Fe^de^r^a^{l C}ⁱ^r^c^uit
^s^e^{nt the}^c^a^s^e^ba^c^k^{to the}^tr^ia^{l c}^o^ur^{t f}^o^r^dis^c^ov^e^r^y^{on w}^h^e^t^he^r^the^pa^t^e^{nt m}^onop^oly^{did, i}ⁿ^f^a^c^t^{, tr}^aⁿ^s^l^a^t^e^into^a^r^e^le^v^a^nt
^m^a^r^k^e^t^m^onopoly⁽^I^nde^pe^nde^nt^Iⁿ^k^,^Iⁿ^c^.^v^.^I^l^lin^ois^T^ool^W^o^r^k^s^,^Iⁿ^c^{., 18}^{3 Fe}^{d. A}^ppx^.⁹⁵³⁽^F^e^d^{. C}ⁱ^r^.²⁰⁰⁶⁾⁾^.^For^a^m^o^r^e
^de^ta^ile^{d d}ⁱ^s^c^us^sⁱ^on^of^the^I^lli^no^is^T^{ool W}^o^r^k^s^c^a^s^e^a^{nd the}^e^f^f^e^c^t^of^a^pa^te^nt^{on a}^pr^e^s^um^ption^of^m^a^r^k^e^t^pow^e^r^,^see
^{CRS Rep}^o^r^t^RS2²⁴²¹^,^Aⁿ^titrust^Effe^c^t^{of P}^a^te^nt^oⁿ^Tyⁱ^ng^Prod^uc^t^:^Illin^{ois T}^ool^W^o^rk^{s Inc}^.^v^.^I^nde^p^e^nde^{nt I}ⁿ^k^,^Iⁿ^c^.^{, by}
^J^a^nic^e^{E. R}^u^bⁱ^n.
²⁴^Uⁿ^ite^d^Sta^t^e^s^v^.^C^o^l^u^m^b^ia^Ste^e^l^{, 334}^U^.^S.⁴^95,⁵^27-^{28 (}¹⁹⁵⁶⁾^.
²⁵³²^{2 U}^.^S^.⁷¹⁶⁽¹⁹⁴⁴⁾^,^c^e^r^tifyⁱⁿ^g^a^nd^tr^ansfe^rrin^g^t^h^e^c^a^s^e^{to the}^Se^c^{ond C}ⁱ^r^c^uit.
²⁶^Uⁿ^ite^d^Sta^t^e^s^v^.^A^l^um^inu^m^C^o^{. o}^f^A^m^e^r^ic^a^,¹⁴⁸^F.2^d⁴¹^6,⁴²^{4 (}²^d^Cⁱ^r^.¹⁹⁴⁵⁾^.
²⁷^Uⁿ^ite^d^Sta^t^e^s^v^.^G^r^inne^{ll C}^o^r^p^.,³⁸⁴^U^.^S.⁵^63,⁵^70-^{71 (}¹⁹⁶⁶⁾^.
²⁸^“[^A^]^p^r^{actice is n}^o^t^‘an^tico^m^p^e^tit^iv^{e’ si}^m^p^l^y^b^ecau^se^{it h}^a^rm^{s co}^mp^etito^rs.^Af^{ter all,}^alm^o^{st b}^u^sⁱⁿ^{ess activ}^it^y^,
^de^sira^ble^a^nd^un^de^sira^ble^a^lik^e^,^s^e^e^k^{s to a}^d^v^a^nc^e^a^fⁱ^r^m^’s^f^o^rtune^s^a^t^the^e^x^pe^nse^of^{its c}^o^m^p^e^titors.^Ra^the^r^,^{a pr}^ac^tic^e
^{is ‘ant}^ic^ompe^titiv^e^’^onlyⁱ^f^it^har^{ms the}^c^o^mpe^titiv^e^proc^e^ss.⁽^T^ow^{n of}^C^onc^or^{d v}^.^B^o^s^t^oⁿ^E^d^is^oⁿ^C^o^.,⁹¹^{5 F}^.²^d¹⁷^,²¹^st
⁽¹^Cⁱ^r^.¹⁹⁹⁰⁾^,^c^e^r^{t. de}^nie^d^,⁴⁹⁹^U^.^{S. 9}³¹⁽¹⁹⁹¹⁾⁾⁽^e^m^pha^sⁱ^s^a^dde^d)^.^S^ee,^a^l^so^{, D}^a^ta^G^e^ne^ra^{l Corp.}^v^.^G^r^u^m^m^aⁿ^st
^Sy^s^t^em^s^Suppor^{t C}^o^r^p^.,³⁶^F.^3d^,¹¹⁸^{2 (}¹^Cⁱ^r^.¹⁹⁹⁴⁾^.

An allegation of “attempted monopolization,” as does a charge of “monopolization,” requires
proof of predatory or anticompetitive conduct (i.e., “guilty behavior”) on the part of the would-be ²⁹
monopolist; but because “a full blown monopoly [will not yet] ha[ve] been accomplished,”
there must also be proof that the defendant entity (a) specifically intended to achieve monopoly
status and (b) that there is/was a “dangerous probability” that monopoly status could be ³⁰
achieved. Moreover, emphasizing the importance of determining the relevant market, the
Spectrum Sports Court continued, “[i]n order to determine whether there is a dangerous
probability of monopolization, courts have found it necessary to consider the relevant market and ³¹
the defendant’s ability to lessen or destroy competition in that market.”
The basic antitrust truth, expressed in 1919 by the Supreme Court in United States v. Colgate & ³²
Co., notwithstanding certain exceptions and attempts to circumscribe it, remains that an entity—
even a monopolist—is free to deal or not deal with any other entity unless its actions constitute ³³
either “guilty behavior” or an attempt to expand its monopoly into a market adjacent to the one
in which it may hold a lawful monopoly:
^In^t^h^{e abs}^eⁿ^{ce of}^any^pu^rpos^{e t}^o^creat^e^{or m}^aⁱⁿ^t^aⁱⁿ^a^m^oⁿ^opol^y^,^t^h^{e [S}^h^e^r^m^an^{] act}^doesⁿ^o^t
^res^t^{rict th}^{e lo}ⁿ^g^recogn^{ized ri}^g^h^t^o^f^{trader or}^m^aⁿ^u^fa^c^t^ur^e^r^e^nga^ge^dⁱⁿ^aⁿ^eⁿ^tⁱ^r^e^l^{y p}^rⁱ^v^a^t^e

²⁹^P^a^la^din^A^s^s^o^c^.^v^.^Montaⁿ^a^Pow^e^r^C^o^.,⁹⁷^F.^Su^pp^{. 2}^d¹⁰¹³¹⁰³⁸⁽^D^{. Mo}^nt.²⁰⁰⁰⁾^,^af^f’^d^.^,³²⁸^F.^3d¹¹⁴^{5 (}⁹^th^Cir.
²⁰⁰³⁾^.
³⁰^Spe^c^t^rum^Sports^{, Inc}^.^v^.^Mc^Q^u^ill^aⁿ^{, 5}^{06 U}^.^S.⁴⁴^7,⁴⁵^{6 (}¹⁹^{93) (}ⁿ^o^lia^bility^“^f^{or a}^ttem^p^te^{d m}^onopoli^z^a^{tion u}^nde^r^§²
^of^the^She^r^m^a^{n A}^c^{t a}^b^se^{nt proof}^of^a^da^ng^e^r^{ous pr}^oba^b^ility^tha^t^th^e^y^w^{ould m}^ono^pol^iz^e^a^pa^rtic^ula^r^m^a^r^k^e^t^a^nd
^sp^eci^fⁱ^{c i}ⁿ^t^eⁿ^t^t^o^m^o^no^po^lⁱ^ze.^”).
³¹^Id^.⁽^note^gⁱ^vⁱ^ng^c^a^s^e^c^ita^tions^om^itte^d).
³²²⁵^{0 U}^.^S^.³⁰⁰⁽¹⁹¹⁹⁾^.
³³^A^m^onopo^ly^a^c^h^ie^ve^{d by}^m^e^aⁿ^s^of^{, e}^.^g^{., pre}^d^a^t^ory^pric^ing^,^{or s}^o^m^e^othe^{r ty}^pe^of^aⁿ^tic^om^pe^titiv^e^{(or “}^g^uilty^”⁾
^be^ha^vⁱ^or^{, is}^vⁱ^e^w^e^d^a^s^dis^tinc^tly^dif^f^e^r^eⁿ^{t f}^r^o^m^a^law^f^ul^m^onop^oly^—^one^w^h^ic^{h ha}^s^de^v^e^lope^{d “}^a^s^a^c^ons^e^que^nc^e^of^a
^su^p^e^ri^o^r^p^r^od^u^c^t^,^bu^siⁿ^e^{ss acu}^m^eⁿ^,^{or h}ⁱ^st^o^rⁱ^cal^acci^d^eⁿ^t^.^”^S^ee,^e.^g.^,^B^e^r^k^ey^P^h^oto^,^Iⁿ^c^.^v^.^Ea^s^t^m^a^{n K}^oda^k^C^o^.,⁶⁰³
^F^.^2d²⁶^3,²⁸^{1 (}²^d^Cⁱ^r^.¹⁹⁷⁹⁾^,^c^e^r^{t. de}^nie^d⁴⁴⁴^U^.^S.¹⁰⁹³^{, 1}⁰⁹⁴⁽¹⁹⁸⁰⁾^,^Mr^{. J}^u^s^tic^e^B^l^a^c^k^m^{un dis}^s^eⁿ^ting^f^r^om^the
^de^nia^l^of^c^e^r^t.,^e^s^pe^cⁱ^a^lly^c^onc^e^r^ning^w^h^e^t^he^r^K^oda^k^ha^d^unla^w^f^u^lly^m^onopoliz^e^d^the^p^h^o^t^o-^fⁱ^nis^hⁱⁿ^g^por^ti^on^of^the
^market^,^an^d^qu^oti^ng,^Uⁿ^ite^d^Sta^t^e^s^v^.^G^r^inne^{ll C}^o^r^p^.,³⁸^{4 U}^.^S.⁵^63,⁵⁷^0-⁷¹⁽¹⁹⁶⁶⁾^r^e^:^the^la^w^f^ulne^s^s^of^a^m^onop^oly
^“achⁱ^e^ved^{as a co}ⁿ^s^eq^u^eⁿ^{ce o}^f^{a su}^p^e^ri^o^r^p^r^o^d^u^c^t^,^b^u^sⁱⁿ^{ess acu}^m^eⁿ^,^o^r^hⁱ^st^o^rⁱ^c^acci^d^eⁿ^t^”;^and^Cro^ssr^o^a^d^s^Co^gen^e^ratⁱ^oⁿ
^C^o^r^p^{. v}^.^O^r^aⁿ^g^e^&^R^o^c^k^la^{nd U}^til^s^{., I}ⁿ^c^.^,¹⁵⁹^F.3^d¹²^9,¹⁴^{1 (}³^{d C}ⁱ^r^.¹⁹⁹⁸⁾^.^A^ltho^u^g^h^{, i}ⁿ^B^e^rkey^{, the}^Se^c^{ond C}ⁱ^r^c^uit
^w^a^s^s^p^e^cⁱ^fⁱ^c^a^l^l^y^a^ddr^e^s^sⁱ^ng^the^d^u^ty^of^a^m^onopol^is^{t to}^s^h^a^r^e^inf^o^r^m^a^{tion a}^b^out^its^p^l^a^nne^dⁱⁿ^tr^o^duc^tion^of^ne^w
^p^r^od^u^c^t^s^t^h^at^w^o^u^l^dⁱ^m^p^act^t^h^o^s^e^al^read^y^exi^s^tⁱⁿ^{g i}ⁿ^t^h^{e m}^a^rk^et^,ⁱ^t^s^reasoⁿⁱⁿ^gⁱ^s^ref^l^ectⁱ^v^{e o}^f^{case l}^a^{w t}^h^at^uⁿ^d^e^rsco^res
^the^c^onc^e^p^t^tha^t^e^v^eⁿ^a^m^ono^pol^{ist doe}^s^not^ha^v^e^a^duty^{to a}ⁱ^d^{its c}^o^m^p^e^{titors by}^de^a^ling^w^{ith the}^m^:
^“^{... a}^fⁱ^rm^m^a^y^norm^a^ll^y^k^e^e^p^itsⁱ^nnov^a^tⁱ^ons^s^e^c^r^e^t^f^r^om^its^riv^a^ls^as^long^a^s^{it w}ⁱ^s^h^e^s^{, f}^o^rc^ing^the^m^{to c}^a^t^c^h^u^p^{on t}^h^e
^s^t^r^e^ng^{th of}^theⁱ^r^ow^{n e}^f^f^o^r^t^s^af^te^r^the^ne^w^pr^od^uc^{t is}ⁱⁿ^tr^od^uc^e^d^.^S^e^e,^e.^g^.^,^Kew^aⁿ^{ee Oi}^l^C^o^.^v.^Bⁱ^cron^Co^r^p^{., 41}⁶^U^.^S^.
⁴⁷⁰^{, 4}⁸¹^...⁽¹⁹⁷⁴⁾^{. It}^{is t}^h^{e p}^o^ssib^ility^o^f^su^{ccess in}^th^{e m}^a^r^k^et^p^l^ac^{e, attrib}^u^t^ab^{le t}^o^su^p^e^rio^r^p^e^rf^o^r^man^{ce, th}^{at p}^r^o^v^id^es
^the^inc^eⁿ^tⁱ^v^e^s^{on w}^h^ic^{h t}^h^e^pr^ope^{r f}^unc^tioni^ng^of^ou^{r c}^o^m^p^e^titiv^e^e^c^onom^y^re^s^t^s^.^If^a^fⁱ^r^m^tha^t^ha^s^eⁿ^g^a^g^e^{d in the}^ris^k^s
^a^{nd e}^x^pe^ns^e^s^of^r^e^s^e^a^r^c^h^a^{nd de}^v^e^lopm^eⁿ^{t w}^e^r^e^r^e^quir^e^{d i}ⁿ^a^{ll c}ⁱ^r^c^um^s^t^aⁿ^c^e^s^{to s}^h^a^r^e^w^{ith its}^rⁱ^v^a^ls^the^be^ne^f^its^of
^those^eⁿ^de^a^v^{ors, this i}ⁿ^c^eⁿ^tiv^e^woul^{d v}^e^ry^like^l^y^be^v^itia^te^d.
^“^W^ithholdⁱ^ng^f^r^om^othe^rs^a^d^v^a^nc^e^k^now^le^dg^e^of^one^’s^ne^w^produc^ts^{, the}^r^e^f^ore^,^ordi^na^rily^c^ons^titute^s^v^a^{lid c}^o^m^p^e^titiv^e
^c^ond^uc^t.”

^b^u^siⁿ^e^ss,^f^r^eel^y^to^ex^er^ci^{se h}ⁱ^s^o^wⁿⁱⁿ^d^e^p^eⁿ^d^eⁿ^{t d}ⁱ^scr^e^tioⁿ^a^s^to^p^a^r^ties^wⁱ^t^h^w^h^o^m^h^e^wⁱ^l^l
^{deal; an}^{d, of}^cou^r^s^e^{, h}^e^m^a^y^aⁿⁿ^o^uⁿ^{ce i}ⁿ^adv^aⁿ^{ce t}^h^{e circum}^s^t^aⁿ^ces^un^der^w^h^ic^h^h^e^wⁱ^ll³⁴
^r^e^f^u^{se to}^sell.
Moreover, according to the United States Court of Appeals for the Federal Circuit, the
fundamental, Colgate precept of seller choice is not altered by the applicability of either the
patent or copyright law to the item(s) in question, unless it is judicially determined that the patent ³⁵
or copyright in question was fraudulently procured.
The antitrust legality of a situation in which even a genuine monopolist, albeit a lawful one, takes
(or refuses to take) action which adversely affects competition in an adjacent market depends, for
one thing, upon the monopolist’s position vis-a-vis those who compete in that market. Whether
the monopolist may be required to deal advantageously with entities in an adjacent market also
depends on whether the monopolist’s actions are taken in pursuance of an attempt to extend his
lawful monopoly (which, of course, may be the result of patent or copyright grants) in one market
into another by means other than those which resulted in his original, sanctioned market position.
Two courts reached opposite conclusions after analyzing somewhat similar circumstances
involving monopolists’ decisions concerning dealings with entities in adjacent markets that were
their competitors in those markets. In both Eastman Kodak Co. v. Image Technical Services, Inc. ³⁶
(referred to alternatively as Kodak) and In re Independent Service Organizations Antitrust ³⁷
Litigation the requisite competition was presumed. In the first case, however, the ISOs
(independent service organizations) did not directly allege a refusal to deal, but, rather, that ³⁸
Kodak had unlawfully tied the sale of both the repair parts it manufactured, as well of certain
others manufactured under license, to the purchase of its service, violating the antitrust laws by ³⁹
extending its lawful monopoly in the parts market into the service/repair market and, thus,
eliminating much of the competition to itself from ISOs; in the second, plaintiff ISOs alleged
specifically that the Xerox Corporation’s refusal to sell them either patented repair parts or
copyrighted service manuals violated the antitrust laws.

³⁴²⁵^{0 U}^.^S^.^a^t³⁰⁷^.
³⁵^{In re}^I^nde^peⁿ^d^eⁿ^t^Se^rv^ic^e^Org^a^niz^a^{tions A}ⁿ^titrust^L^itig^a^tio^n,²⁰^{3 F}^.^3d¹³²²^{, 1}³²⁶⁽^F^e^d^{. Cir}^.²⁰⁰⁰^).^S^ee,^a^l^so,
^f^ootnote²³^,^sup^r^a^{, a}^{nd a}^s^s^o^cⁱ^a^t^e^d^te^x^t^c^onc^e^rⁿⁱ^ng^the^im^por^ta^nc^e^of^m^onop^oly^pow^e^r^{in a}^r^e^le^v^a^{nt m}^a^r^k^e^t^.
³⁶⁵⁰^{4 U}^.^S^.⁴⁵¹⁽¹⁹⁹²⁾^,^aff’g⁹^{03 F.}^{2d 61}²⁽⁹^th^{Cir. 1}⁹⁹⁰^).
³⁷²⁰³^F.^3d¹³²²⁽^F^e^d^.^Cⁱ^r^.²⁰⁰⁰⁾^,^c^e^r^{t. de}^nie^d^s^ub^nom^.^,^CSU^,^L^.^L^.^{C. v}^.^X^e^r^o^x^Corp^.,⁵³¹^U^.^S.¹¹⁴³⁽²⁰⁰¹⁾^.
³⁸^Ty^ing^e^x^is^t^s^w^h^eⁿ^a^v^e^ndor^s^a^y^s^{, in e}^f^f^e^c^t^{, “}^I^f^y^{ou w}^a^{nt B}^,^y^{ou m}^u^s^t^ta^k^e^A^.^”
³⁹^T^h^{e d}^e^fⁱⁿⁱ^tⁱ^oⁿ^o^f^t^h^{e rel}^e^van^t^m^a^rket^w^a^{s i}^t^s^el^f^anⁱ^ssu^e,^w^{ith Kod}^a^k^a^s^s^e^rting^,^a^{nd t}^h^e^S^upre^m^e^{Court re}^je^c^ting^the
^c^onteⁿ^ti^on^{, t}^h^a^t^sⁱ^nc^e^it^di^{d n}^o^t^ha^v^e^a^m^onop^oly^{in the}^m^a^nuf^a^c^t^ur^ing⁽^o^r^“^o^rⁱ^gⁱ^na^{l e}^q^uⁱ^pm^eⁿ^t”⁾^m^a^r^k^e^t^{, it c}^oul^d^not,
^the^r^e^f^or^e^,^ha^v^e^a^m^onop^oly^{in the}^pa^r^t^s^{it m}^a^nuf^a^c^t^ur^e^d^f^o^r^tha^t^e^q^uⁱ^pm^eⁿ^{t: “}^R^e^s^pondeⁿ^t^s^...^c^oⁿ^t^eⁿ^d^tha^t^K^o^da^k^’^s
^c^ontro^{l ov}^e^r^the^pa^{rts m}^a^rke^t^ha^{s e}^x^c^l^ude^{d se}^rv^ic^e^c^o^m^p^e^tition.^...”
^K^oda^k^c^oun^te^r^s^tha^t^e^v^eⁿ^if^{it c}^oⁿ^c^e^d^e^s^m^onop^oly^s^har^e^of^the^r^e^le^v^a^{nt pa}^r^t^s^m^a^r^k^e^t^{, it c}^a^nnot
^act^u^a^l^l^y^e^x^er^ci^{se t}^h^{e n}^ecessar^y^m^a^rket^pow^e^r^f^o^r^a^She^r^m^aⁿ^A^c^{t v}ⁱ^ola^tio^n.
^{* *}^*
^K^oda^k^a^l^s^o^c^oⁿ^t^e^nds^t^h^a^t^{, a}^s^a^m^a^tte^r^of^la^w^,^a^sⁱ^ng^le^br^a^{nd or}^a^pr^o^duc^t^or^s^e^r^v^ic^e^c^aⁿ^ne^v^e^r^be^a
^r^e^le^v^a^nt^m^a^r^k^e^t^unde^r^t^h^e^S^h^e^r^m^a^{n A}^c^{t. W}^e^dis^a^g^r^ee^.
⁵⁰⁴^U^.^S.^a^t⁴^65-⁴⁶^6,⁴⁸^{1 (}^e^m^pha^sⁱ^s^{in or}^ig^ina^l⁾

The Supreme Court held, in Image Technical Services, that the lower courts must determine
whether Kodak, in fact, possessed sufficient market power in the market for parts used to service
photocopier equipment to be able to unlawfully tie the purchase of service for its copiers to the
purchase from it of repair parts for those copiers (in other words, to require purchasers of its
copier equipment to agree either to use only its repair parts/service or not to use the repair ⁴⁰
parts/services of an ISO); on remand, a jury found the existence of the Supreme Court’s
required monopoly power and the misuse of that power in the service market, and the appeals ⁴¹
court affirmed that finding and the injunction it precipitated. In the Independent Service
Organizations Antitrust Litigation, the United States Court of Appeals for the Federal Circuit
upheld the United States District Court for Kansas’ grant of summary judgment to Xerox, noting,
first, that although a patent holder (or other intellectual property owner) does not, by virtue of his
patent, have a right to violate the antitrust laws, “it is also correct that the antitrust laws do not ⁴²
negate the patentee’s right to exclude others from patent property.” The court, emphasizing that ⁴³
the differing allegations in this case and Image Technical Services necessitated a different
approach to analyzing the antitrust legality of the challenged actions, stated:
^{... Kodak}^doesⁿ^o^t^hⁱⁿ^{g to li}^mⁱ^t^th^{e ri}^g^h^{t of t}^h^{e pate}ⁿ^t^{ee to re}^f^u^s^e^{to s}^e^{ll or lice}ⁿ^s^e^wⁱ^t^hⁱⁿ^t^h^e
^s^c^{ope of}^th^e^s^t^at^u^t^or^y^{patent gran}^{t. In}^f^act,^w^e^h^a^v^e^e^x^pres^s^l^y^h^e^{ld th}^{at, abs}^eⁿ^t^e^x^ception^a^l
^cir^c^u^m^staⁿ^{ces, a p}^a^ten^t^m^a^y^coⁿ^f^er^t^h^{e r}ⁱ^g^h^{t to}^ex^clu^d^{e co}^m^p^e^titioⁿ^alto^g^e^t^h^erⁱⁿ^m^o^r^e^t^h^an
^on^{e an}^titr^u^s^t^m^a^rk^e^t^....
^{... In}^th^{e absen}^{ce of}^anyⁱⁿ^dicat^ion^of^illeg^a^{l t}^yⁱⁿ^g^,^f^r^au^{d in}^t^h^e^P^a^ten^t^an^d^T^r^adem^a^r^k^Of^fⁱ^c^e^,
^o^r^sh^a^m^liti^g^a^tioⁿ^,^t^h^{e p}^a^teⁿ^t^h^o^l^d^e^r^m^a^y^eⁿ^f^o^r^{ce t}^h^{e stat}^u^t^o^r^y^rⁱ^g^h^{t to}^e^x^cl^u^d^{e o}^t^h^e^r^s^f^r^o^m⁴⁴
^m^a^kⁱⁿ^g^,^u^sⁱⁿ^g^,^o^r^sellⁱⁿ^g^th^e^cl^ai^m^e^dⁱⁿ^v^eⁿ^tioⁿ^f^r^ee^f^r^o^m^liab^ilit^y^uⁿ^d^e^r^t^h^{e a}ⁿ^titr^u^s^t^la^w^s^.
An earlier, related “adjacent market” case presented the Federal Trade Commission (FTC) with a
situation in which the publisher of The Official Airline Guides chose to list the schedules and
connecting flights of smaller, commuter airlines less advantageously than those of the major
airlines, undeniably putting the “commuters” in an unfavorable position; the Commission was
rebuked by the United States Court of Appeals for the Second Circuit for having ruled that the ⁴⁵
publisher acted in violation of Section 5 of the FTC Act, which prohibits “unfair acts of
practices in commerce”:
The Commission did not find in the present case ‘any purpose to create or maintain a monopoly,’
but went on to say that ‘the philosophy of Colgate must give way to a limited extent where the
business judgment is exercised by a monopolist in an arbitrary way.’ The Commission conceded
that its result ‘may be inconsistent to some extent with the theory of the Colgate doctrine.’
* * *

⁴⁰⁵⁰^{4 U}^.^S^.^a^t⁴^62-⁴⁶^5.
⁴¹^I^m^ag^e^T^e^c^hnic^a^l^Se^r^v^ic^e^s^{, I}ⁿ^c^.^v^.^Ea^s^t^m^a^{n K}^oda^k^C^o^.,¹⁹⁹⁶^W^L¹⁰¹¹⁷³⁽^N^.D^{. C}^a^l.¹⁹⁹⁶⁾^,^aff’dⁱⁿ^{part, re}^v^’^dⁱⁿ
^par^t,¹²⁵^F.^3d¹¹⁹⁵⁽⁹^th^Cⁱ^r^.¹⁹⁹⁷⁾^,^cert^.^d^eⁿⁱ^ed,⁵²^{3 U.}^S^.¹⁰⁹⁴⁽¹⁹⁹⁸⁾^.
⁴²²⁰³^F.^3d^at¹³²⁵^,^qu^otiⁿ^g^,^Iⁿ^te^r^g^r^a^{ph C}^o^r^p^{. v}^.^Iⁿ^te^{l C}^o^r^p^.^,¹⁹⁵^F.³^d¹³⁴⁶^,¹³^{62 (}^F^e^d^{. C}ⁱ^r^.¹⁹⁹⁹⁾^.
⁴³^“^K^odak^w^a^{s a t}^yⁱⁿ^{g c}^a^se^w^h^enⁱ^t^ca^m^e^b^e^f^o^{re t}^h^{e S}^u^p^r^em^{e Co}^u^r^t^,^an^d^[^uⁿ^lⁱ^k^{e t}^h^{e case b}^e^f^o^{re u}^s^]^{no p}^a^t^eⁿ^t^s^h^a^d^b^een
^a^s^s^e^rte^d^{in de}^f^e^ns^e^of^the^aⁿ^titrus^t^c^l^aⁱ^m^s^a^g^aⁱ^ns^{t K}^oda^k^.^”²⁰³^F.^3d^a^t¹³²⁷^.
⁴⁴^Id^.
⁴⁵^{15 U}^.^S.C^.^§⁴⁵^.

^{... w}^e^t^hⁱⁿ^k^eⁿ^f^o^rce^m^en^{t of}^t^h^{e FT}^C^’^s^{order h}^e^{re w}^o^u^l^{d give th}^{e FT}^C^{too m}^u^c^h^po^w^e^{r to}
^su^b^s^t^itu^{te it}^{s o}^wⁿ^b^u^sⁱⁿ^e^{ss j}^u^d^g^m^eⁿ^t^f^o^r^th^{at o}^f^th^e^m^oⁿ^o^p^o^{list in}^an^y^d^ecisioⁿ^t^h^{at ar}^g^u^a^b^ly
^af^f^e^c^t^{s co}^m^p^etitioⁿⁱⁿ^aⁿ^o^t^h^e^rⁱⁿ^d^u^s^t^r^y^{. S}^u^ch^{a d}^ecisioⁿ^w^o^u^l^d^p^e^r^m^{it t}^h^{e FT}^{C to}^d^e^lv^eⁱⁿ^t^o^,
^{as t}^h^e^Co^m^mⁱ^ssioⁿ^it^self^p^u^t^t^h^{e e}^x^tr^e^m^e^case,^‘^s^o^c^{ial, p}^o^liti^{cal, o}^r^p^e^r^s^oⁿ^{al r}^easoⁿ^s^’^f^o^r^a
^m^oⁿ^opolis^t^’^s^refu^s^a^{l to deal.}^...^T^h^u^s^{, if}^t^h^{e on}^l^y^s^u^per^m^ar^k^e^{t in}^to^wⁿ^decides^{to s}^t^ock
^Bⁱ^r^d^sey^e^v^e^g^e^tab^l^{es b}^u^tⁿ^o^{t G}^r^een^Gian^{t v}^e^g^e^tab^l^{es, t}^h^{e FT}^C^w^o^u^l^d^b^e^ab^{le to}^r^e^q^u^ir^{e it t}^o⁴⁶
^sto^c^k^Gr^een^Gian^t^v^e^g^e^tab^l^{es i}^f^it^w^e^r^e^to^fⁱⁿ^d^Gr^een^Giaⁿ^{t c}^o^m^p^eti^tiv^e^l^y^dⁱ^sad^v^an^tag^e^d^.
The court concluded: “We do not think that the Colgate doctrine is as dead as the Commission ⁴⁷
would have it.” The Official Airline Guides case remains the touchstone for assessing a
monopolist’s duty to deal advantageously with non-competitor entities in an adjacent market.
From almost the beginning of statutory antitrust law (the enactment of the Sherman Act in 1890),
the concept of the so-called “essential facilities” doctrine has been developing; courts have rather
consistently held that a monopolist who controls an instrumentality that is crucial to the ability of
a potential competitor to compete and which cannot be reasonably duplicated by the potential
competitor must make that facility available to him. Perhaps the most well known “essential
facilities” case is United States v. Terminal Railroad Association, in which access to the only
terminal in St. Louis that could reasonably accommodate rail traffic to the west was required to be ⁴⁸
made available to potential competitors of the railroads who jointly owned the terminal. The
concept of an “essential facility” was determinative when, in 1985, the Court required the owner
of three of four skiing mountains to continue allowing the owner of the fourth mountain to jointly ⁴⁹
market access to all four mountains.
As the United States Court of Appeals for the Seventh Circuit explained, in MCI Communications
Corp. v. AT&T, a case that required AT&T to grant connection to its telephone lines in order to
allow MCI to compete in the long-distance telephone business,
^A^m^oⁿ^opolis^t’s^refu^s^a^{l to deal un}^{der th}^es^e^circum^s^t^an^ce^s^[t^h^e^requ^es^{ted acce}^s^s^w^a^s^both
^techⁿⁱ^call^y^aⁿ^d^ecoⁿ^o^mⁱ^ca^ll^y^f^eas^ib^le]^is^g^o^v^e^rⁿ^ed^b^y^th^e^so^-^called^e^sseⁿ^tial^f^a^c^ilitie^s
^doctrin^{e. S}^u^c^h^{a refu}^s^a^l^m^a^y^{be u}ⁿ^l^a^w^{ful becau}^s^e^a^m^oⁿ^opolis^t’s^con^t^{rol of}^aⁿ^ess^eⁿ^t^ial
^f^acilit^y⁽^s^o^m^eti^m^{es [}^e^sp^ecial^l^yⁱⁿ^teleco^m^m^uⁿⁱ^catioⁿ^s^la^w^]^called^{a ‘}^b^o^ttlen^e^c^k^’^[^a^p^oⁱⁿ^t
^t^h^roug^h^w^hⁱ^c^h^e^v^er^y^t^hⁱ^ng^destⁱⁿ^ed^f^o^{r a s}^p^eci^fⁱ^{c poi}ⁿ^t^m^u^s^t^pas^s^{]) can}^e^x^t^eⁿ^d^m^oⁿ^opol^y
^po^w^e^{r f}^r^o^m^on^{e s}^t^a^g^{e of}^produ^ctⁱ^oⁿ^t^o^an^ot^h^e^{r, an}^{d f}^r^o^m^on^{e m}^a^rk^etⁱⁿ^t^o^an^ot^h^e^{r. T}^h^u^s^{, t}^h^e
^an^titr^u^s^{t la}^w^s^h^a^v^eⁱ^m^p^o^s^ed^oⁿ^fⁱ^r^m^{s co}ⁿ^t^r^o^llin^g^aⁿ^es^sen^tial^f^acilit^y^th^{e o}^b^lⁱ^g^atioⁿ^to^m^a^k^e⁵⁰
^th^{e f}^a^c^ilit^y^av^ailab^l^{e o}ⁿⁿ^oⁿ^dⁱ^s^crⁱ^mⁱⁿ^ato^r^y^ter^m^s.
Curtis Trinko challenged, as a violation of the antitrust laws, Verizon’s failure to adequately share
its network facilities with his provider of telecommunications service, as required by the

⁴⁶^O^f^fⁱ^cⁱ^a^l^Aⁱ^r^line^G^u^ide^s^{, I}ⁿ^c^.^v^.^F^T^C^,⁶³⁰^F.2^d⁹²⁰^,⁹²^5,⁹²^{7 (}²^{d C}ⁱ^r^.¹⁹⁸⁰⁾^,^c^e^r^{t. de}^n.,⁴^{50 U}^.^S.⁹¹⁷⁽¹⁹⁸¹⁾^.
⁴⁷⁶³⁰^F.^2d^at⁹²^7.
⁴⁸²²^{4 U}^.^S^.³⁸³⁽¹⁹¹²⁾^.
⁴⁹^As^peⁿ^Skⁱⁱⁿ^{g C}^o^{. v}^.^As^pe^{n H}ⁱ^ghl^ands^Skⁱⁱ^ng^.⁴^{72 U}^.^S.⁵⁸⁵⁽¹⁹⁸⁵⁾^.
⁵⁰⁷⁰^{8 F}^.²^d¹⁰⁸¹^,¹¹³²⁽⁷^th^{Cir. (}¹⁹⁸³^)),^cert^.^d^eⁿⁱ^ed,⁴⁶⁴^U^.^S.⁸^{91 (}¹⁹⁸³⁾^.

Telecommunications Act of 1996.⁵¹ His suit was filed as a class action immediately following a
series of state and federal regulatory actions that penalized Verizon for failing to comply with the
act’s mandate to provide any requesting telecommunications carrier with interconnection service ⁵²
“at least equal to that provided by the local exchange carrier to itself ....” The complaint alleged
that Verizon “continues to resist competitive entry by carriers seeking to compete entirely with
their own facilities,” and consequently, that customers of Verizon’s competitors have been injured
in their business or property by reason of “Verizon’s “exclusionary and anticompetitive behavior.”
The Court rejected both Trinko’s reasoning and his arguments.
The opinion first discussed and described the regulatory scheme set out in the
Telecommunications Act, the regulatory actions carried out pursuant thereto, and the effect of the
act’s antitrust “savings clause.” After observing that the savings clause foreclosed the possibility
of either unquestioningly substituting the regulatory scheme for traditional antitrust analysis or
granting the regulated entity the benefit of implied antitrust immunity, the Court noted
nevertheless that the savings clause “preserves [only] those ‘claims that satisfy established ⁵³
antitrust standards.’” It then analyzed those “established standards”—monopoly status, and the
offenses of “monopolization” and “attempted monopolization”—and quoted from the “Colgate
doctrine” concerning the “long recognized right” of a private businessman “to exercise is own ⁵⁴
independent discretion as to parties with whom he will deal.” Prior cases that had utilized the
“essential facilities” doctrine were distinguished by the Court, which found the differences
between them and its present case significant: Aspen was not available to Trinko because access
to the “essential facility” in that case (the defendant’s three mountains), previously granted, had ⁵⁵
been withdrawn. Terminal Railroad and another case relied on by Trinko, Associated Press v. ⁵⁶
United States, were also distinguished, the Court noting that both “cases involved concerted ⁵⁷
action, which presents greater anticompetitive concerns ....” The majority stressed its belief that
although Verizon had violated a duty imposed by the act, it had not violated any obligation—⁵⁸
positive or negative—imposed by the antitrust laws.

⁵¹^P^.^L^.¹⁰^4-1⁰⁴^;^t^h^e¹⁹⁹⁶^A^c^{t c}^ons^titute^{d a}ⁿ^a^m^e^ndm^eⁿ^{t to t}^h^e^Com^m^unic^a^tions^A^c^{t of}¹⁹³⁴^{, 4}⁷^U^.^S^.^{C. §§}¹⁵¹^et^seq^.
⁵²^{47 U}^.^S.C^.^§²⁵¹⁽^c⁾⁽²⁾⁽^C⁾^.
⁵³⁵⁴^{0 a}^t⁴⁰^{6 (}^e^m^pha^sⁱ^s^a^dde^d)^.
⁵⁴^Id^{. a}^t⁴⁰^8.
⁵⁵^Id^.^a^t⁴⁰^8-⁴⁰⁹^:^“^As^pe^{n Sk}ⁱⁱⁿ^gⁱ^s^at^o^rⁿ^{ear t}^h^{e ou}^t^e^{r bo}^un^d^a^ri^{es o}^f^§²^lⁱ^a^bⁱ^lⁱ^t^y^.^T^h^{e Co}^u^r^t^t^h^{ere f}^o^und^si^gnⁱ^fⁱ^can^{ce i}ⁿ
^t^h^{e d}^e^f^eⁿ^d^aⁿ^t^{’s d}^eci^si^oⁿ^t^o^{cease p}^a^rtⁱ^cⁱ^p^atⁱ^oⁿⁱⁿ^{a coo}^p^e^ratⁱ^v^{e ven}^t^u^r^e.^”
⁵⁶³²^{6 U}^.^S^.¹⁽¹⁹⁴⁵⁾^.
⁵⁷⁵⁴^{0 U}^.^S^.^a^t⁴¹⁰^,ⁿ^o^te^{3 (}^e^m^pha^sⁱ^s^{in or}^ig^ina^l⁾^.
⁵⁸^For^a^dditi^ona^l^de^ta^{il, s}^e^e^C^R^S^R^e^por^{t R}^S²¹⁷^23,^V^e^ri^zo^{n Co}^mmunⁱ^ca^tⁱ^oⁿ^s^,^In^c.^v.^T^rⁱⁿ^ko^{: T}^e^l^eco^mm^uⁿⁱ^catⁱ^oⁿ^s
^C^ons^um^e^r^s^C^aⁿⁿ^{ot U}^s^e^Ant^itr^us^t^Law^s^to^Re^m^e^dy^Ac^c^e^s^s^Violat^ioⁿ^s^{of Te}^le^c^o^m^m^u^nic^a^ti^ons^Ac^t^{, by}^J^a^nic^e^{E. R}^u^bⁱ^n.

The 1992 jointly issued Horizontal Merger Guidelines⁵⁹ make clear that the
“monopoly”/”monopolization” dichotomy is a key enforcement concept. The Guidelines were
promulgated in order to inform the business community of the agencies’ (DOJ, FTC) governing
philosophy and “analytical framework” when they are reviewing the permissibility of proposed
mergers, but they afford a good view of the agencies’ overall thinking about antitrust culpability.
The “Purpose and Underlying Policy Assumptions” section of the Introduction states
unequivocally that “mergers should not be permitted to create or enhance market power or to
facilitate its exercise; it goes on to note, however, that while “competitively harmful” mergers
will be challenged, there is a “larger universe of mergers that [is] either competitively beneficial ⁶⁰
or neutral.” We earlier quoted an Assistant Attorney General to the effect that competitive harm ⁶¹
rather than size is the determinative element in a decision on a reviewed merger.
Two relatively recent cases clearly illustrate the antitrust enforcement agencies’ differentiation
between the existence of monopoly power and active monopolization: the Department of Justice ⁶²⁶³
suit against Microsoft and the FTC’s complaint against Intel. In Microsoft, the Antitrust
Division stated that “Microsoft possesses (and for several years has possessed) monopoly power ⁶⁴
in the market for personal computer operating systems.” The DOJ action, however, was filed not
to challenge Microsoft’s monopoly status, but rather, the company’s actions:
^T^o^p^r^ot^ectⁱ^t^s^v^a^l^u^abl^e^[an^d^p^r^es^um^abl^y^,^l^a^w^f^u^l^]^Wiⁿ^d^o^w^s^m^oⁿ^opol^y^a^g^aiⁿ^s^t^{... pot}^en^tⁱ^a^l
^com^p^etⁱ^tⁱ^v^{e t}^h^reat^s^,^aⁿ^{d t}^o^ex^t^eⁿ^dⁱ^t^s^operatⁱⁿ^g^sy^s^t^e^m^m^oⁿ^opol^yⁱⁿ^t^o^ot^h^e^{r s}^o^f^t^w^a^re
^ma^r^k^e^t^s,^Micr^os^{oft has}^engage^{d in}^{a s}^e^rⁱ^es^{of anticompetitive}^a^c^tⁱ^v^ities^{. Mi}^cros^of^t^’^s^con^d^u^c^t
ⁱⁿ^cl^u^d^es^ag^ree^m^eⁿ^t^s^t^yⁱⁿ^g^ot^h^e^{r Mi}^cros^of^t^s^o^f^t^w^a^{re produ}^ct^s^t^o^Mi^cros^o^f^t^’^s^Wiⁿ^d^o^w^s⁶⁵
^operatⁱⁿ^g^sy^s^t^e^m^;^e^x^c^l^u^sⁱ^oⁿ^a^r^y^a^g^r^e^e^m^eⁿ^t^s^p^r^e^c^l^u^dⁱⁿ^g^c^o^m^p^aⁿⁱ^e^s^o^r^p^o^t^en^tial^co^m^p^etito^r^s

⁵⁹^Th^e^Guide^line^s^w^e^re^issue^dⁱⁿ¹⁹⁶²^by^the^Aⁿ^{titrust Div}ⁱ^sion^{, a}ⁿ^d^re^vⁱ^se^{d in 1}⁹⁸²^aⁿ^{d 1}⁹⁸⁴^{. T}^h^e^y^we^re^substa^ntia^lly
^m^odifⁱ^e^d^a^{nd is}^s^u^e^d^j^oⁱⁿ^tly^by^D^o^J^a^{nd t}^h^e^FT^C¹⁹⁹²^{, a}ⁿ^{d r}^e^vⁱ^s^e^{d by}^the^a^g^eⁿ^cⁱ^e^s^{in 199}^{7. T}^h^e¹⁹⁸⁴^v^e^r^s^{ion i}ⁿ^dⁱ^c^a^t^e^d
^tha^t^the^De^pa^rtm^e^{nt w}^{ould c}^onsi^d^e^r^f^o^re^ig^{n a}^s^w^e^{ll a}^s^dom^e^s^tic^c^o^m^p^e^{tition in}^de^te^rm^ining^the^g^e^og^ra^phic^m^a^rke^t^f^o^r
^the^pr^od^uc^ts^or^s^e^r^v^ic^e^s^of^a^poteⁿ^tia^{l m}^e^r^g^e^r⁽^§^2.34)^{. T}^h^e¹⁹⁹²^v^e^r^s^{ion s}^t^a^t^e^s^tha^t^t^h^e^“^u^nif^y^ing^them^e^of^the
^Guⁱ^d^elⁱⁿ^es^is^tha^t^m^e^rg^e^r^s^s^hould^not^be^pe^rm^itte^{d to}^c^r^e^a^t^e^{or e}^nha^nc^e^m^a^r^k^e^t^pow^e^r^{or to f}^a^c^ilita^te^its^e^x^e^r^cⁱ^s^e^”^§
⁰^.¹⁾^.^T^h^{e 1}⁹⁹⁷^revi^si^oⁿ^d^eal^t^on^l^y^wⁱ^t^h^t^h^{e agen}^ci^{es’ t}^r^eat^m^eⁿ^t^o^f^t^h^{e so}^-cal^l^e^d^“effⁱ^ci^en^c^y^d^e^f^eⁿ^s^e”:^{a m}^e^r^g^{er t}^h^atⁱ^s^,
^on^ba^la^nc^e^,^aⁿ^tic^om^pe^titiv^e^,^w^{ill not g}^e^ne^ra^lly^be^“^s^a^v^e^d^”^b^y^c^l^aⁱ^m^e^{d or a}^c^t^ua^{l e}^f^fⁱ^cⁱ^eⁿ^cⁱ^e^s^{, nor lik}^e^l^y^be^a^pprov^e^d^by
^the^r^e^vⁱ^e^w^ing^ag^eⁿ^cⁱ^e^s⁽^§⁴⁾^{. A}^lthoug^{h t}^h^e^Gui^d^e^line^s^a^r^eⁿ^o^t^bin^dⁱⁿ^g^{on e}ⁱ^the^r^t^h^e^Aⁿ^{titrust Div}ⁱ^sioⁿ^or^the^FT^{C (or}^,
^f^o^{r tha}^t^m^a^tte^{r, the}^c^{ourts), t}^h^e^y^a^r^e^indic^a^tiv^e^of^the^a^g^eⁿ^cⁱ^e^s^{’ thin}^kⁱ^ng^w^{ith re}^spe^c^t^{to the}^c^o^m^p^e^titi^v^e^c^onc^e^r^ns
ⁱⁿ^h^e^ren^tⁱⁿ^al^l^m^a^rk^et^t^r^an^sactⁱ^oⁿ^s^.
⁶⁰^M^e^rge^r^Guide^line^s^{, §}⁰^.^1.
⁶¹^Se^e^f^o^o^t^no^t^e¹⁸^and^asso^ci^at^ed^t^e^xt^.
⁶²^Uⁿ^ite^d^Sta^t^e^s^v^.^Mic^r^os^of^{t, C}ⁱ^v^il^A^c^{tion N}^o^{. 9}⁸^-¹²³^{2, f}^ile^{d i}ⁿ^t^h^e^Uⁿ^ite^{d S}^t^a^t^e^s^Dⁱ^s^t^rⁱ^c^t^C^our^{t f}^o^r^th^e^Dⁱ^s^t^rⁱ^c^t^of
^C^o^lum^b^ia^on^Ma^y^{18, 1}⁹⁹⁸⁽^h^e^r^eⁱ^na^f^t^e^r^r^e^f^e^r^r^e^{d to a}^s^“^C^om^plaⁱ^nt”⁾^“^t^{o r}^e^s^t^r^aⁱⁿ^ant^ic^ompe^titiv^e^c^o^nd^uc^t^by^de^f^e^nda^nt
^Mic^r^os^of^{t Corp}^ora^tio^{n .}^..,^the^w^o^rld’s^la^rg^e^s^{t s}^upp^lie^{r of}^c^o^m^pute^r^s^o^f^t^w^a^re^f^o^{r pe}^rs^ona^{l c}^o^m^pute^r^s^..^.^.^”^(Com^plaⁱ^{nt ¶}^1,
^em^pha^sⁱ^s^a^dde^d)^;⁸⁷^F.^Sup^p^.^2d³⁰⁽^D^.D^.C^.²⁰⁰⁰⁾⁽^“^C^onc^l^u^sⁱ^oⁿ^s^of^L^a^w^”⁾^,^{97 F.S}^u^p^p^.^2d⁵⁹⁽^D^.D^.C^.²⁰⁰⁰⁾⁽^“^Fina^l
^J^udg^m^e^nt”⁾^;^aff’^{d i}ⁿ^p^a^r^t^{, r}^e^v^.ⁱⁿ^par^t,^“^Fi^na^{l J}^u^dg^m^e^nt”^v^a^c^a^te^{d, r}^e^m^ande^d^to^be^as^sⁱ^gne^d^to^ne^w^j^u^dge^,²⁵^{3 F.}^3d³⁴
⁽^D^.C^{. C}ⁱ^r^.²⁰⁰¹⁾^;^cert^.^d^eⁿ^.^,⁵^34U^.S.⁹⁵^{2 (}²⁰⁰¹⁾^;^{on r}^e^m^a^nd^,²³^{1 F}^.^S^u^pp^.2^d¹⁴⁴⁽^D^.^D^.^C^{. 20}⁰²⁾^;^aff’^d^s^ub^nom^.^,
^Ma^s^s^a^c^hus^e^tts^v^.^Mic^r^os^of^{t C}^o^r^p^.^,³⁷³^F.3^d¹¹^{99 (}^D^.C^.C^ir^.²⁰⁰⁴⁾^.
⁶³^{In re}^Iⁿ^te^{l Cor}^pora^tⁱ^oⁿ^,^Doc^.^N^o^.⁹²^88,^f^ile^{d June}^8,¹⁹⁹⁸^(he^r^eⁱ^na^f^t^e^r^re^f^e^rr^e^d^{to a}^s^Doc^k^e^t^No.⁹²⁸⁸^{), se}^ttle^d^Ma^y
^17,¹⁹⁹⁹^by^m^e^aⁿ^s^of^a^C^ons^eⁿ^t^D^e^c^r^e^e^;^Se^e^http://w^ww^.^g^ov^.f^t^c^/opa^/19⁹⁹^/⁹⁹⁰^3/^inte^lc^om^.htm^f^o^{r de}^ta^{ils of}^the^Conseⁿ^t
^D^e^c^r^e^e^a^{nd http:}^//w^w^w^.g^ov^.^f^tc^/^o^pa^/19⁹⁹^/⁹⁹⁰^4/^inte^ls^t.htm^f^o^r^FT^C^c^o^m^m^e^nts^on^the^de^c^r^e^e^.
⁶⁴^Com^p^la^int,^2.
⁶⁵^B^y^r^e^f^u^sⁱ^ng^{to s}^e^{ll one}^pr^o^duc^t^to^a^buy^e^r^unle^s^s^the^buy^e^r^a^g^r^e^e^s^als^o^to^ta^k^e^a^de^sⁱ^gⁿ^a^t^e^d^s^e^c^ond^pr^oduc^t⁽^“^y^ou
^can^’t^b^u^y^X^wⁱ^t^h^ou^t^Y”),^t^yⁱⁿ^{g p}^r^ecl^u^d^e^{s t}^h^{e bu}^y^e^{r’s ch}^oⁱ^{ce co}ⁿ^cernⁱⁿ^g^w^h^{ere t}^o^pu^rch^a^{se each}^co^m^pone^{nt, a}^nd
^f^o^re^c^l^ose^s^{to othe}^{r se}^lle^{rs a}^p^o^rti^o^{n of}^the^m^a^rk^e^t^{in the}^tie^d^pr^o^duc^t^.^T^h^e^e^s^ta^blis^he^{d “}^t^e^s^t”^f^o^r^a^ty^ing^vⁱ^ola^{tion f}ⁱ^r^s^t
⁽^c^onti^nue^d.^..)

^f^r^o^m^di^s^t^ri^bu^tⁱ^ng^{, prom}^otⁱⁿ^g^,^buyⁱⁿ^g^,^{or u}^sⁱⁿ^g^produ^ct^s^of^Mi^cros^of^t^’^s^s^o^f^t^w^a^r^e^c^o^m^p^e^tⁱ^t^o^r^s
^o^r^p^o^t^en^{tial co}^m^p^etito^r^s^{; an}^d^e^x^clu^s^ioⁿ^a^r^y^a^g^r^e^e^m^eⁿ^{ts r}^e^strⁱ^c^tin^g^th^e^rⁱ^g^h^{t o}^f^co^m^p^an^ie^{s to}⁶⁶
^p^r^o^vⁱ^d^e^s^e^r^vⁱ^c^e^s^o^r^r^e^s^o^u^r^c^e^s^t^o^Mⁱ^c^r^o^s^o^f^t^’^s^s^o^f^t^wa^r^e^c^o^m^p^e^tⁱ^t^o^r^s^o^r^p^o^ten^tial^co^m^p^etito^r^s^.
In the charges against Intel Corporation by the FTC, the Commission acted to restrain the “pattern ⁶⁷
of conduct ... that violates Section 5 of the Federal Trade Commission Act, 15 U.S.C. § 45,” and ⁶⁸
not because of Intel’s acknowledged monopoly status.
^{As a}^m^onopolⁱ^s^t^{, In}^{tel ca}ⁿ^c^o^m^p^ete^b^y^produ^ciⁿ^g^better,^ch^{eaper an}^d^m^o^{re attracti}^v^e
^produ^ct^s^.^It^{cannot act to ce}^{ment its}^{monopoly pow}^er^{by pr}^{eventing other}^fir^ms^f^r^om
^chal^l^e^ngiⁿ^gⁱ^t^s^domⁱ^nance.^In^{tel h}^a^s^ac^{ted illeg}^a^ll^y^.^It^h^a^s^u^s^{ed it}^s^m^oⁿ^opol^y^po^w^e^{r to}
ⁱ^m^p^e^d^eⁱⁿⁿ^o^v^a^tⁱ^oⁿ^aⁿ^d^sti^f^le^co^m^p^eti^tioⁿ^[^b^y^d^eⁿ^yⁱⁿ^gⁿ^ece^ssar^y^techⁿⁱ^{cal i}ⁿ^f^o^r^m^atioⁿ^to
^cer^tain^c^u^sto^m^er^{s i}ⁿ^r^e^talⁱ^atioⁿ^f^o^r^th^eir^s^u^its^ag^aiⁿ^s^{t I}ⁿ^{tel to}^en^f^o^r^{ce th}^eir⁽^t^h^e^c^u^s^t^o^m^er^s^’⁾⁶⁹
^p^a^ten^t^{s, alle}^g^e^d^l^yⁱⁿ^f^rⁱⁿ^g^e^d^b^y^Iⁿ^tel]^.

Judicial determination of “monopoly” status for a market participant says nothing concerning the
lawfulness of the monopoly enjoyed. At most, monopoly status indicates that the monopolist
possesses sufficient market power to “control prices or exclude competition.” But such a
determination does not automatically create an obligation on the part of the monopolist to deal—
at all, or “fairly”—with other entities in the market, or with consumers. That obligation may be
created only by a further finding either that the monopolist has achieved his monopoly position in
violation of the prohibitions against monopolization or attempted monopolization in the Sherman
or Clayton Antitrust Acts or the prohibition against unfair practices in the Federal Trade
Commission Act (i.e., possesses an unlawful monopoly); or that he has unlawfully exploited even
a lawfully obtained monopoly position; or both. In other words, a monopolist’s “guilty behavior”
is what creates a monopolization violation of the antitrust laws, not his status as a monopolist.
The duty to deal with actual or potential competitors of a lawful monopolist who has not been
found to have engaged in some “guilty behavior” is generally governed by the Colgate doctrine,
which gives market participants the right to choose their commercial relationships. That “right,”
however, has been thought to have been circumscribed by what has become known as the
“essential facilities” doctrine; it stands for the proposition that a monopolist who possesses or
controls a necessary component of an actual or potential competitor’s business must make it

^(...c^on^tin^ue^d)
^req^uⁱ^{res t}^h^at^t^h^{ere b}^e^t^w^o^sep^a^rat^e^p^r^o^d^u^c^t^s^—each^,^o^r^ei^t^h^er,^cap^a^b^l^e^o^f^b^eⁱⁿ^{g pu}^rch^a^sed^sep^a^rat^e^l^y^b^y^{a co}ⁿ^s^u^m^er,^b^u^t
^a^l^s^o^a^de^f^e^nda^{nt w}^{ith m}^onop^oly^pow^e^r^{in the}^m^a^r^k^e^t^f^o^r^the^ty^ing^pr^od^uc^{t, la}^c^k^of^c^hoic^e^f^o^r^the^c^o^ns^um^e^r^{, a}^nd
^f^o^recl^o^s^u^r^{e o}^f^{a su}^b^s^t^aⁿ^tⁱ^a^l^vo^l^u^{me o}^f^co^mmerc^e.^T^yⁱⁿ^{g i}^s^m^o^st^gen^e^ral^l^y^an^al^y^z^ed^{as a}^p^e^{r se}^vⁱ^ola^tion^of^the^aⁿ^titr^ust
^la^w^s^{, a}^lthoug^{h w}^h^eⁿ^a^c^our^t^ha^s^f^a^ile^{d to f}ⁱⁿ^d^the^r^e^quis^ite^“^s^e^p^a^r^a^t^e^pr^od^uc^ts^,”^a^R^u^le^of^R^e^a^s^{on a}ⁿ^a^l^y^s^is^ha^s^be^eⁿ
^em^ploy^e^d^.^S^{ee e.}^g^.^,^Uⁿ^ite^{d S}^t^a^t^e^s^v^.^J^e^{rrold Ele}^c^t^ro^nic^s^Cor^p^.,¹⁸⁷^F.Su^pp^{. 5}⁴⁵^(E.D^.^P^a^{. 1}⁹⁶⁰^),^aff’^{d pe}^r^c^u^rⁱ^am^,³⁶⁵
^U^.^{S. 5}⁶⁷⁽¹⁹⁶¹⁾^{; B}^r^oa^dc^a^s^{t Mus}ⁱ^c^,^Iⁿ^c^.^v^.^C^R^S^,⁴^{41 U}^.^S.^{1 (}¹⁹⁷⁹⁾^;^J^e^f^f^e^r^s^on^P^a^rⁱ^s^h^H^o^s^p^ita^{l D}ⁱ^s^t^rⁱ^c^t^N^o^.^{2 v}^.^H^y^de^,
⁴⁶⁶^U^.^S.^{2 (}¹⁹⁸⁴⁾^.^Se^e^f^oot^note²³^,^sup^r^a^,^f^o^r^the^e^f^f^e^c^t^of^a^pa^te^nte^d^ty^ing^pr^od^uc^{t o}ⁿ^t^h^e^c^onsⁱ^d^e^r^a^tion^of^a
^de^f^e^nda^nt’^s^m^onop^oly^pow^e^r^{in the}^m^a^r^k^e^t^f^o^r^the^ty^ing^pr^od^uc^t.
⁶⁶^C^o^m^p^la^{int, ¶}^{5 (}^e^m^pha^sⁱ^s^a^dde^d)^.
⁶⁷^Iⁿ^tr^o^duc^ti^on^to^FT^C^D^o^c^k^e^t^N^o^.⁹²⁸^{8 (}^e^m^pha^sⁱ^s^a^dde^d)^.
⁶⁸^D^o^c^k^e^t^N^o^{. 9}²⁸⁸^{, ¶ ¶}^4-¹⁰^.
⁶⁹^FT^{C P}^r^e^{ss Re}^le^a^s^e^Issue^d^{to A}ⁿⁿ^ounc^e^A^g^eⁿ^c^y^{’s Filin}^g^Ag^aⁱ^{nst Inte}^{l, June}^8,¹⁹⁹⁸^(e^m^pha^{sis a}^dde^d⁾^.

available to his competitor(s) if it cannot reasonable be obtained—at all, or only at prohibitive
expense.
In Verizon Communications, Inc. v. Trinko, however, the Supreme Court questioned the validity of
the “essential facilities” doctrine in antitrust law—at least in the context of regulated entities.
When a regulated entity violates a regulatory statute that compels the sharing of specifically
named facilities, the Court said, there is not also an automatic antitrust violation without a finding
that that behavior would have violated something in the antitrust laws—with or without the ⁷⁰
existence of the statutory requirement.
^J^aⁿⁱ^c^e^E^.^Rubⁱⁿ
^L^e^gⁱ^s^l^at^iv^{e A}^t^torn^e^y
^j^r^u^bⁱⁿ^@^c^rs^.loc.g^ov^{, 7}^-⁹⁰⁷⁹

⁷⁰^T^h^{e ref}^u^sal^t^o^d^eal^al^l^e^gedⁱⁿ^t^h^e^p^r^esen^t^{case d}^o^e^{s no}^t^f^{it w}^{ithin t}^h^e^lim^ite^{d e}^x^c^e^{ption re}^c^o^gⁿ^iz^e^dⁱⁿ^A^s^pe^{n Sk}^iing
^[^C^o^.^v^.^A^s^pe^{n H}ⁱ^g^h^la^nds^Sk^iing^C^o^r^p^.,⁴^{72 U}^.^S.⁵⁸^{5 (}¹⁹⁸⁵⁾^]^.^T^h^e^c^o^m^p^la^{int doe}^s^{not a}^lle^g^e^tha^t^Ve^rⁱ^z^{on v}^o^l^unta^r^ily
^eⁿ^g^a^g^e^{d in a}^c^our^s^e^of^de^a^ling^w^{ith its}^rⁱ^v^a^ls^,^or^w^ould^e^v^e^r^ha^v^e^done^s^o^a^b^s^e^{nt s}^t^a^t^u^t^or^y^c^o^m^pulsⁱ^{on. H}^e^r^e^{, the}^r^e^f^or^e^,
^the^de^f^e^nda^{nt’s p}^r^{ior c}^oⁿ^duc^{t s}^h^e^d^{s n}^o^lig^ht^u^p^oⁿ^the^m^o^tiv^a^tion^of^{its re}^f^u^sa^{l to de}^a^l^—u^po^{n w}^h^e^t^he^{r its re}^g^u^la^tory
^lap^s^{es were p}^r^o^m^p^t^edⁿ^o^t^b^y^co^mp^etitiv^{e zeal b}^u^t^b^y^an^tico^m^p^e^titiv^e^m^a^lice.^T^h^{e co}ⁿ^t^{rast b}^e^tw^een^th^{e cases is}
^he^ig^hteⁿ^e^d^by^the^dif^f^e^r^eⁿ^c^e^{in pr}^ic^ing^be^ha^vⁱ^or^{. I}ⁿ^As^pe^{n Sk}ⁱⁱⁿ^g^{, t}^h^e^de^f^e^nda^{nt t}^u^rne^d^d^o^wⁿ^a^pro^p^o^sa^{l to se}^{ll a}^t^its
^ow^{n re}^ta^{il pric}^e^,^sug^g^e^sting^a^c^a^l^c^u^la^tio^{n t}^h^a^t^{its f}^u^ture^m^ono^po^ly^r^e^ta^{il pr}^ic^e^w^ould^be^hig^h^e^r^.^Ve^rⁱ^z^on’^s^r^e^luc^t^aⁿ^c^e^to
^inte^r^c^on^ne^c^t^a^t^the^c^o^s^t^-^b^a^s^e^d^r^a^te^of^c^o^m^p^eⁿ^s^a^{tion a}^v^a^ila^ble^un^de^r^{§ 2}⁵¹⁽^c⁾⁽³⁾^[^o^f^the¹⁹^{96 T}^e^le^c^o^m^m^unic^a^tions^A^c^t]
^te^lls^usⁿ^o^th^ing^a^b^out^dr^e^a^m^s^of^m^onopoly^.^T^h^e^s^p^e^cⁱ^fⁱ^c^na^tur^e^of^w^h^a^t^the¹⁹^{96 A}^c^{t c}^o^m^p^e^l^s^m^a^k^e^s^this^c^a^s^e^dif^f^e^r^e^nt
^fr^o^m^As^pe^{n Sk}ⁱⁱⁿ^gⁱⁿ^{a m}^o^{re f}^uⁿ^d^a^m^en^t^a^l^wa^y^.^In^As^pe^{n Sk}ⁱⁱⁿ^g^{, w}^h^a^t^the^de^f^e^nda^{nt re}^f^u^se^{d to}^pr^ov^id^e^{to its c}^o^m^p^e^titor
^w^a^{s a}^prod^uc^{t tha}^t^{it a}^l^re^a^d^y^sold^a^t^re^ta^{il—to ov}^e^r^sim^p^lify^slig^htl^y^{, lif}^{t tic}^k^e^{ts re}^pre^s^eⁿ^ting^a^bu^ndle^of^se^rv^ic^e^s^to
^s^k^ie^rs^{. ... In t}^h^e^pre^s^eⁿ^t^c^a^s^e^,^by^c^ontra^s^t^,^the^s^e^rv^ic^e^s^a^lle^g^e^dl^y^wⁱ^t^hhe^ld^a^r^e^not^ot^he^rw^is^e^m^a^r^k^e^t^e^d^{or a}^v^a^ila^ble^{to t}^h^e
^pub^lic^{. T}^h^e^s^h^a^r^ing^oblig^a^tio^{n im}^pos^e^d^by^the¹⁹^{96 A}^c^{t c}^r^e^a^t^e^d^‘^s^om^e^t^hing^br^aⁿ^{d ne}^w^’^—^’^the^w^hole^s^a^l^e^m^a^r^k^e^t^f^o^r
^l^easiⁿ^{g n}^e^t^w^o^r^{k el}^e^m^en^t^s^.^’
^{* *}^*
^{... w}^e^do^not^be^lie^v^e^tha^t^tra^dⁱ^tioⁿ^a^{l a}ⁿ^titrust^priⁿ^cⁱ^ple^s^j^u^s^tify^a^dding^the^pre^s^eⁿ^t^c^a^s^e^{to the}^f^e^w^e^x^c^e^ptio^{ns f}^r^om^the
^pro^positi^on^tha^t^t^h^e^r^e^{is n}^o^duty^{to a}ⁱ^d^c^o^m^p^e^{titors. 5}^{40 U}^.^{S. a}^t⁴⁰^9-4^10,⁴^11.